On 24 September, Germany will elect the lower house of its federal parliament (Bundestag). Prior to the election, financial markets will be particularly volatile, in reaction to winner/loser projections and other surveys of voter opinion. Thanks to a new artificial-intelligence (AI) tool from Swiss online banking and brokerage leader Swissquote Group Holding SA (SWX:SQN), investors can capitalise on these voter opinions to make investment decisions.
Today, Swissquote launched the #DE30 Social Sentiment Index, developed in collaboration with the Social Media Lab of the EPFL (École Polytechnique Fédérale de Lausanne). The index summarises and evaluates the opinions expressed on social media regarding the German DAX (stock index of Germany’s 30 largest, public companies).
This dedicated financial dashboard which will analyze and describe the impacts of the coming German Election on financial markets comes within a series of financial cockpits Swissquote built for traders to decrypt potential impacts of major geopolitical events on financial markets. It started 1 year ago with US Election and also covered last May’s French Election.
An algorithm, with the help of artificial intelligence, identifies investors’ optimistic and pessimistic views. Natural language processing (NLP) is used to interpret the meaning of texts posted to social media. Graph theory is used to determine the context of each text, so that interpretation errors are avoided.
From this AI analysis, a real-time, consensus opinion can be derived as to whether a given stock is likely to rise or fall and whether the entire market is likely to move up or down. This can guide investors in adjusting or allocating positions in equities and currencies.
Also for the German elections, Swissquote analysts have compiled a basket of stocks that should benefit from the pro-European, company-friendly policies of the two major parties (Angela Merkel’s CDU and Martin Schulz’s SPD).
Marc Bürki, CEO of Swissquote, commented:
The use of artificial intelligence in finance is still beginning. Our goal is to drive its development, so that it can be used as quickly as possible by the broadest possible audience.