RESEARCH:
European Equities Surge

Artificial intelligence trained for the purpose of investment research can capture information in media, such as news reports, that is often overlooked by financial market participants.

We use Alexandria Technologies AI to read Dow Jones news reports, both the headline and body, with the purpose of classifying subject matter and sentiment for each entity within an article. 

We then create a sentiment score for each topic for companies in the EuroStoxx600 and regress the daily topic sentiment to daily forward return in order to compute a beta for each topic.  The results are both compelling and significant.  

• Annual return and Sharpe Ratio of 35.9% and 2.44 for the period of 2010 to June 30, 2024.
• Continued performance in 2023 and 2024, with a cumulative excess return over 30% above the Stoxx600.
• Outperformance in volatile and negative markets (2022).

* News sentiment derived from Dow Jones Newswires (https://www.dowjones.com/professional/newswires/)