Search arXivSearch

arXiv · 2502.05403

Analyzing public sentiment to gauge key stock events and determine volatility in conjunction with time and options premiums

Abstract

Analyzing stocks and making higher accurate predictions on where the price is heading continues to become more and more challenging therefore, we designed a new financial algorithm that leverages social media sentiment analysis to enhance the prediction of key stock earnings and associated volatility. Our model integrates sentiment analysis and data retrieval techniques to extract critical information from social media, analyze company financials, and compare sentiments between Wall Street and the general public. This approach aims to provide investors with timely data to execute trades based on key events, rather than relying on long-term stock holding strategies. The stock market is characterized by rapid data flow and fluctuating community sentiments, which can significantly impact trading outcomes. Stock forecasting is complex given its stochastic dynamic. Standard traditional prediction methods often overlook key events and media engagement, focusing its practice into long-term investment options. Our research seeks to change the stochastic dynamic to a more predictable environment by examining the impact of media on stock volatility, understanding and identifying sentiment differences between Wall Street and retail investors, and evaluating the impact of various media networks in predicting earning reports.

Explore related subjects

Keep this discovery

Explore connections, maps & timelines

BibTeXRIS

SriVarsha Mulakala, Umesh Vangapally, Benjamin Larkey, Aidan Henrichs, Corey Wojslaw. 2025-02-08. Analyzing public sentiment to gauge key stock events and determine volatility in conjunction with time and options premiums. https://arxiv.org/abs/2502.05403

Cite the original work for its findings. Save a collection to share your selection of sources.

KEEP EXPLORING

Related papers

Online Regularized Statistical Learning in Reproducing Kernel Hilbert Space With Non-Stationary Data

We study recursive regularized learning algorithms in the reproducing kernel Hilbert space (RKHS) with non-stationary online data streams. We introduce the concept of a random Tikhonov regularization path and decompose the tracking error of the algorithm's output for the regularization path into random difference equations in RKHS. We show that the tracking error vanishes in mean square and almost surely if the regularization path is slowly time-varying. Then, leveraging the monotonicity of inverse operators and the spectral decomposition of compact operators, and introducing the RKHS persistence of excitation condition, we develop a dominated convergence method to prove the mean square and almost sure consistency between the regularization path and the unknown function to be learned. Especially, for independent and non-identically distributed data streams, the mean square and almost sure consistency between the algorithm's output and the unknown function is achieved if the input data's marginal probability measures are slowly time-varying and the average measure over each fixed-length time period is uniformly above a strictly positive finite Borel measure.

cs.LG

Reflective Policy Optimization

On-policy reinforcement learning methods, like Trust Region Policy Optimization (TRPO) and Proximal Policy Optimization (PPO), often demand extensive data per update, leading to sample inefficiency. This paper introduces Reflective Policy Optimization (RPO), a novel on-policy extension that amalgamates past and future state-action information for policy optimization. This approach empowers the agent for introspection, allowing modifications to its actions within the current state. Theoretical analysis confirms that policy performance is monotonically improved and contracts the solution space, consequently expediting the convergence procedure. Empirical results demonstrate RPO's feasibility and efficacy in two reinforcement learning benchmarks, culminating in superior sample efficiency. The source code of this work is available at https://github.com/Edgargan/RPO.

cs.LG

Transductive Off-policy Proximal Policy Optimization

Proximal Policy Optimization (PPO) is a popular model-free reinforcement learning algorithm, esteemed for its simplicity and efficacy. However, due to its inherent on-policy nature, its proficiency in harnessing data from disparate policies is constrained. This paper introduces a novel off-policy extension to the original PPO method, christened Transductive Off-policy PPO (ToPPO). Herein, we provide theoretical justification for incorporating off-policy data in PPO training and prudent guidelines for its safe application. Our contribution includes a novel formulation of the policy improvement lower bound for prospective policies derived from off-policy data, accompanied by a computationally efficient mechanism to optimize this bound, underpinned by assurances of monotonic improvement. Comprehensive experimental results across six representative tasks underscore ToPPO's promising performance.

cs.LG