Could Text Analytics be a Remedy to Optimize How You React to Major Market and Regulatory Changes

It’s no secret that the past decade has been rife with unprecedented challenges for financial services firms. With financial markets, technologies and regulatory requirements in a constant state of flux complicating everything from day-to-day operations to customer communications, it seems impossible to make any lasting progress. On the bright side, however, every firm is facing the same challenges, and there is a golden opportunity to win the hearts of customers and regulators alike by being able to adapt to them with ease. That agility can be a ‘game changer’ in reducing time between discovery and action; and in the financial markets every micro-second counts.

Once you acknowledge that there’s very little you can do about external forces at work, it becomes a matter of optimizing how quickly you can react and potentially take advantage of the changes to create a competitive advantage. To do so, you need to elicit the most pertinent, need-to-know information to help you make the right decision – and then act on it with confidence.

Text analytics software is one tool that provides a proven method of keeping your finger on the pulse of everything going on generally in the financial world, as well as the specific industries whose securities you trade. In short, the tool helps you extract the proverbial ‘needle from the haystack’ - from vast amounts of text or data. Essentially, the application can save time and effort when you don’t have time and effort to spare and enable much faster reaction which could gain you competitive advantage.

As an example, imagine you’re doing research into the structured  products, and the information you receive from the hedge fund company is in PDF or PPT format. It’s nuanced, it’s complicated and, most of all, it’s really, really long.

By inputting the PDF or PPT into a text analytics platform, unstructured data be read and analyzed. You can apply a simple taxonomy comprised of entities you want to know more about and it will return only critical information from the document and ignore the rest. You can even do the same with internal enterprise documents, including everything from collaborative platforms like SharePoint, to premium subscriptions and sources.

In the above scenario, the benefits are clear to see, especially where fast and accurate decision making is critical and beneficial. Here are some of the vital use cases for text analytics software that could finally transform documents into actionable intelligence for financial services firms:

-        Current awareness with automatic alerts: Despite its power and utility, Google just doesn’t cut it with so much going on in our industry. To keep up you need an intelligent search platform with real-time data monitoring and automatic alerts to deliver the latest aggregated content on the companies, equities and regulators who impact your investments and funds.

-        Regulatory regime monitoring: Whether its implementation or violation, compliance can be very costly. Monitoring the regulatory regime in real-time, across multiple languages can help you anticipate regulatory changes and react quickly, whilst being able to search your enterprise assets for sensitive information can help identify and prevent a compliance violation.  

-        On-demand research desk: Intelligent search features and the ability to ingest content from almost any source make text analytics platforms excellent for conducting research on competitors, customers, market makers and anything else you need to keep an eye on.

-        Sentiment analysis: Text analytics software often features a sentiment analysis function that can help determine how people feel about a specific entity, including not only companies or their brand as a whole, but telling metrics like reaction to stock price and earnings.

These use cases example how text analytics could potentially save you time and effort whilst helping you make better and more profitable decisions, So, how do you make investing in text analytics worthwhile? It’s not a silver bullet, but when implemented correctly, it can make a huge impact on your agility as a company and, based on how you react to this actionable intelligence, even improve your footing with customers and regulators. Your wealth managers, investment bankers, financial analysts and other personnel will be eager to give it a test drive.