Automated Insights, Inc.

Automated Insights and AP Increase Trading of Forgotten Firms

Posted by Automated Insights on Dec 28, 2016

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A recent study by researchers at Stanford and the University of Washington found that Automated Insights’ technology has had a profound effect on the stock market. Hundreds of firms that got very little attention from traders are now seeing significantly more trading volume and liquidity, thanks to a technology partnership between the Associated Press and Automated Insights. Before the partnership, the AP could only cover around 300 firms. With Wordsmith, our groundbreaking platform for writing automation, the AP can now cover around 4,500 firms each quarter.

2016 Review Financialmarkets Graph

The researchers focused on the impact "robo-journalism" has on capital markets, specifically the Associated Press’ (AP) use of Automated Insights’ (Ai) technology to automate corporate quarterly earnings reports. The AP first started using natural language generation, or NLG, back in 2014 with the help of Ai. 

“For a sample of 2,249 firms with little previous media coverage, we find significant increases in abnormal trading volume and depth after firms begin receiving automated articles. These results are consistent with automated articles catching investor attention, motivating trading, and improving market liquidity.” --Blankespoor, Elizabeth and deHaan, Ed and Zhu, Christina, Robo-Journalism and Capital Markets. Page 30. (November 7, 2016)

Aside from freeing up time for writers, giving them more freedom to do what they do best, we also allow firms to produce more written material than ever before. We’re not out to replace human writers, only to help them. For more information, check out our live tracker on how many jobs we have actually replaced (hint: none).

This new study very exciting for us. Knowing that we are influencing capital markets and providing enough visibility for smaller players within the those markets to drive a noticeable change in liquidity and volume is pretty cool! 

For more information about the data, variables, and conclusion, check out the entire study.

For a related news piece written by the AP, check out: Study: News automation by AP increases trading in financial markets