Wednesday, July 26, 2006

Data Mining Makes News: UpTick Partners with Thomson Financial to Build News Based on Automated Analysis

The announcement that Thomson Financial has teamed up with UpTick Data Technologies to generate news stories using its data mining tools is on one level not terribly surprising. The use of text and data mining technologies in financial markets has accelerated in recent years, allowing investment firms to discover insights from raw inputs in small enough time frames to make real differences in their investment strategies. Time frames are crucial to news organizations as well, especially those that cater to the investment crowd, but beats on straight news stories for corporate events are not always easy to come by in an era of Fair Disclosure regulations. This is pushing financial news services to provide more analysis and insight into market trends.

The first target for the TF/UpTick alliance is mining Thomson's own data and analyst's earnings estimates from its First Call service to come up with automated comparisons of estimates to actual corporate earnings reports. Fairly humdrum stuff, but if it gives Thomson a beat it's not humdrum stuff at all - it's then valuable insights into expected market performance that will drive trading activity. With UpTick's extensive library of analysis tools expect the breadth and depth of automated analysis to come up with less obvious insights injected into news streams that can drive markets. Automation and offshoring has helped news organizations to focus their editorial talent on higher levels of market analysis. With tools such as UpTick the level of analysis provided by news wire services to the business sector is going to increase significantly. Hopefully analysts in ratings agencies and other financial publishing houses take note that there are other sources of insight that can develop rapidly thanks to content extraction technologies.
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