Boston-based Patterns and Predictions, which offers data-mining tools based on its Bayesian statistics engine and proprietary algorithms in statistical pattern recognition systems, has unveiled Centiment, an predictive analytics and trading product designed to enable hedge fund managers to quantify in real time the relationship and impact of financial news on the performance of securities.
Centiment was developed to help hedge funds to gauge market sentiment more effectively and determine asset and sector valuation based on their own criteria, then execute their trades based on their resulting risk/return decisions. The product comprises a customisable linguistic analysis system paired with a securities trade execution tool.
'We believe Centiment will appeal to hedge fund firms that want to enhance their ability to deliver alpha, by improving their capability to have more informed opinions about the current and future direction of markets and securities in which they invest,' says Chris Poulin, principal and managing partner at Patterns and Predictions.
'We also believe Centiment will be an attractive system for prime brokers that offer risk management and related analytics capabilities to their hedge fund clientele.'
The software provides investors with search engine technology to power customisable investment analysis coupled with financial trading capability. Its linguistic analysis system can combine feeds of market trading data on tracked securities with text-based marketplace dialogue about those securities and related sectors as reported online in the media.
Many market sentiment analysis software applications available to money managers work in isolation from their securities trade execution tool. For investment managers who already have a securities trading system in place, Centiment's analytics system feed can be ported directly into the execution software.
Patterns and Predictions is a technology partnership between Poulin Holdings and Hugin Expert with a team consisting of mathematical specialists in areas including statistics, applied statistics, computational linguistics and information retrieval. The company provides products ranging from academic research to turnkey enterprise solutions in the field of automated decision systems for industries such as finance, health care and industrial engineering.