Known for its worldwide coverage of breaking news, A.P. is joining forces with RavenPack, a company specializing in news analysis technology, to create new products for quantitative investing and trading models.
The new products will leverage the AP’s depth of content across multiple platforms to provide analysis of market moving events that can be put into action, according to the release. As part of the agreement, AP and RavenPack will develop a series of products, the first of which is scheduled to launch in the first half of 2011. The products will process AP content with sentiment analysis techniques to produce metrics than can be consumed by quantitative models and trading programs. Computers reading signals from the news can create trading transactions or alert traders to specific events. “This relationship with RavenPack will fully leverage the power of our newsgathering organization and provide an excellent extension of our services,” stated A.P.’s Claire Wachter, development manager for financial products. “We look forward to launching these products in response to growing demand in the marketplace and continuing to develop new revenue streams from our global news content.” The first product to be launched as part of the new relationship is designed for equity analysis and will focus on company-related news stories. The product will analyze news stories in real-time to detect events and changes in sentiment for more than 28,000 publicly traded companies. “We are extremely excited about this opportunity to collaborate with such a large and highly trusted news organization,” commented Armando Gonzalez, President & CEO of RavenPack, in the release. “The AP’s depth and breadth of coverage will provide our clients with the most comprehensive information available.
Numerous studies have shown that news analytics calculated from wide-ranging, trusted and reliable sources provide diversification benefits to traditional investment models, thereby adding value to existing trading strategies”.