invest learning log
@04-22 AI paper on predict stock price
A paper use ChatGpt to predict stock return use News headline. their prompt:
Forget all your previous instructions. Pretend you are a financial expert. You are a financial expert with stock recommendation experience. Answer “YES” if good news, “NO” if bad news, or “UNKNOWN” if uncertain in the first line. Then elaborate with one short and concise sentence on the next line. Is this headline good or bad for the stock price of company name in the term term? Headline: headline
the result shows LLM has the ability to judge a news is a good or bad news for stock price, but I think the method they use in paper is basic, normal investor maybe can do better than the AI in judge bad news. but the value is we can use AI to improve our invesment knownledge and the logic relations of company or bond growth.
and basic AI can automatic performed, so we can use AI to do massiave task to the the thing we used can't (likes collect all news and twitter comments to summary market voice to help us better decision).
Yesterday US Flash manufacturing PMI and services PMI comes in above expectation, services PMI expected 51.5 Actual=53.7, Bond yield goes high, price down. TLT plunge 0.6%.
economic hot means inflation stubbornly continues, that's make the investor who expect FED quickly cut interest rate disappointed and leave bond market.
updated logic link
Linear regression is a powerful and easy tool to analyisis market, It's solve the problem of that when use Moving Average to predict price probability. it's direction is old than market, only when turn point has happened , the Moving Average turn can be happen.
but with Linear regression slope, you can see the slope become more and more high and when it's high probability can't be true, the turn point will be high probability happen. slope change before price trending change. so it's a useful tool deserve to learn.
30 years treasury bonds
Bond yield goes little up, and stock price rise much, the market is widespeard expectation that the pace of interest rate hike will slow down.
Generate AI likes ChatGPT and Claude and Brad develop so fast and the experience of use those tools shock me. I'm pretty want to buy Nvidia stock, but I had set a rule that not buy individual stock, ok, how about 10 percent?
Today the plunge of XIAOMI stock price give me a leason of don't gamble.
My question to research:
- Why SVB crisis happened? how intrest rate raise lead bank crisis?
- how federal rate raise affect the bond rate ?
- why bank crisis and bond price up and yield down?
- why 30 year bond yield goes up when federal fund rate goes up (short-term rate goes up)?