With many, if not all screeners, they are based on numerical data. Which is fine if you're looking for numerical data. I'm not looking for numerical data. I'm trying to implement a “Buy the rumor, sell the news” strategy. I already know of a couple opinions on this strategy.
It doesn't work.
The consensus of this view: The strategy can have zero or even a negative effect of a certain piece of news.
My rebuttle: Given the correct piece of news, the impact has a run up to the event. The rumor. Then once the event happens, the market then eases from the news as a sigh of relief.
It's unreliable.
The consensus view: The market is very picky on what news it wants to hear, therefore, the type of news may be unreliable to build an effective strategy around.
My rebuttle: The event has more of a sentimental value rather than a numerical value. The more important the event is to be anticipated, the greater the effect on the rumor run. Therefore, viewing the news as a numerical event will have unreliable results. Gadgeing the sentiment of the news is more reliable.
I gave both sides of an argument specifically for context in my request.
Many securities don't rely on numerical data alone. News, more specially, anticipated news has a major impact on price action. This is nothing new, and has been studied for a long time.
The hard part is, following many tickers, sifting through the upcoming news, and determining what's on the verge impactful events. Yes, one could pick a sector or industry and take enormous amounts of time, reading through filings and articles. Then, take countless hours searching through social media and compiling sentimental data determining a scope of intensity of each individual event. By the time that's done, the chance for error or mis-timing ever increases.
What I'm looking for.
I screener that sifts through all this, gives me the possible impact of what's to be expects, why it's important, and the social sentiment of the event.
Example
Pharma ticker XYZ has announced a submission to the FDA and been awaiting on news for months. Knowing the FDA, news can come out any day, but the timing in uncertain. The screener picks up on this and displays the data, giving me the info to make a decision.This is merely an example in one specific sector. Every sector has this scenario.
Not sticking to one sector is not only time consuming, but completely makes the trader oblivious to other, similar, types of plays in other sectors. Also, not all news plays are predicated by numerical data. A lot of the data takes place on social media and in the filings. This can take place at all hours of the day and a lot of times very suddenly, unless the trade has been closely following a ticker. This causes blinders to other opportunities.
What I've tried: Volume is a lagging indicator in this scenario. A lower than normal volume security that has a sudden pop when news comes out is an opportunity lost. Social media such as StockTwits. It's a good start and they have a rankings page. It doesn't work that well and I still have to sift through the posts of cheerleaders and trolls just to find out why.
Other than that I haven't found anything else.
Here's why I think it's currenty impossible.
APIs are becoming a hot commodity and webmasters are starting to see them as a revenue stream just for this very reason. With the phenomenon of gamestop and reddit, other services are starting to include social sentiment as an indicator. The problem with this is that there are plenty of sites that are there specifically just to confuse readers and these sentiment indicators. Social manipulation is nothing new, just being repurposed. ChatGPT is doing fairly well at language analysis, but it doesn't do web scraping and many sites deem this practice personally illegal.
Other than sifting through StockTwits and reddit, is there anything remotely close to what I'm looking for? I fear there may never be.
TL;DR
I'm lazy and I don't want to take a monstrous amount of time doing research.
Leave a Reply