| Did You Parse Today's News ? There is no doubt that news moves stock prices, but it seems the speed at which that happens leaves no chance for investors to participate in the event. This behavior supports the efficient market hypothesis which claims that all information is immediately incorporated into prices. But what are all the moving parts in this process ? There has been considerable research done on the assimilation of news and reaction by investors in an effort to understand just how the “efficient market” machine works. Now, with analytical tools available from lexicon databases, computer natural language algorithms, and the internet there is a new breed of investor armed with the ability to parse tens of thousands of daily news stories and trade within milliseconds. |
