Deep learning in finance assessing twitter sentiment impact and prediction on stocks

Abstract

The widespread adoption of social media platforms has led to an influx of data that reflects public sentiment, presenting a novel opportunity for market analysis. This research aims to quantify the correlation between the fleeting sentiments expressed on social media and the measurable fluctuations in the stock market. By adapting a pre-existing sentiment analysis algorithm, we refined a model specifically for evaluating the sentiment of tweets associated with financial markets. The model was trained and validated against a comprehensive dataset of stock-related discussions on Twitter, allowing for the identification of subtle emotional cues that may predict changes in stock prices. Our quantitative approach and methodical testing have revealed a statistically significant relationship between sentiment expressed on Twitter and subsequent stock market activity. These findings suggest that machine learning algorithms can be instrumental in enhancing the analytical capabilities of financial experts. This article details the technical methodologies used, the obstacles overcome, and the potential benefits of integrating machine learning-based sentiment analysis into the realm of economic forecasting.

Keywords

• Deep learning
• Natural language processing
• Sentiment analysis
• Artificial intelligence
• Time series forecast
• Stock price forecast