The Robots Know What You’re Thinking
Also Goldman earnings, life insurance and spoofing programs.
I think that, as humans-vs.-robots-in-financial-markets stories go, this one is kind of good news for the humans:
Sure this is a case of robots muscling into a domain—literary analysis?—that was previously reserved for humans. But at least the robots are paying attention to the humans. If you are going to have robots sitting around analyzing the tone and nuance of an earnings call, then there will be opportunities for the humans, since you’ll need them to stall and qualify on earnings calls. Also in the near term you will probably need humans to ask the questions. In the medium term, the next generation of NuanceBots will dial in to earnings calls and ask algorithmically generated questions designed to elicit the maximally informative amounts of stalling. I guess in the long term, a specialized NuanceBot will also be tasked with answering the questions and the earnings calls will become perfectly uninformative again. But for now, the humans are providing the alpha; it is just being filtered through a robot analysis.