How All Investors Can Understand the Market More Efficiently

Regardless of what type of trader you are, it’s crucial to know how the market is responding to new information. The Efficient Market Hypothesis says that all information that is publicly knowable is reflected in asset prices. This means that if you aren’t aware of how the market is reacting to—or “pricing in”—new information, you’re already at a disadvantage.

Silicon Valley Bank SIVB March 9

Consider the recent example of AMC stock moving upon the news of its potential acquisition by Amazon. Even for those who don’t hold Amazon stock, this was a significant development due to the long-term implications for the streaming and film industries. Understanding this kind of narrative is important for decision-making, regardless of your trading approach.

MarketReader enables users to gain this crucial understanding immediately when something is happening in the market. Our suite of proprietary AI models is trained to deliver the most plausible explanation of what events or information are driving asset volatility in real time.

A key example of needing explanatory information quickly is the recent banking crisis, namely the collapse of Silicon Valley Bank (SVB Financial Group/SIVB) in early March.

As shown in our 1-Month Lookback on the Banking Crisis, the MarketReader system identified and explained unusual activity relating to the fallout of the SIVB collapse in real-time over the course of the past month.

The moment SIVB began to move downwards after the market closed on March 8, MarketReader detected the move and immediately returned the correct explanation from precisely filtered newswire and social media sources. The system continued to flag the unusual activity and provide real-time explanations throughout the following days.

The downturn in bank stocks over the past month has affected investors of all types. Any market participant could have benefited from MarketReader’s automated analysis of developments with SIVB and other assets in the banking sector.

MarketReader helps all types of investors understand the market in real-time.

It is important to note that MarketReader does not aim to be predictive or offer buy/sell signals. It is here solely to help investors understand why the market is moving.

In contrast to traditional news sources, MarketReader filters and contextualizes news and other content based on what is actually moving in the market. So, instead of scanning through a feed of noise, MarketReader users are able to differentiate what information is relevant to markets without spending the time and mental energy to cross-reference between a news feed and a stock chart.

Furthermore, news and social media do not often capture the reason behind a market movement on their own. To get the full picture, investors need to digest a wide range of information, like macro and calendar events, trade volume and flow, sympathy moves and correlations, and other factors. The challenge has always been to understand this information quickly and anticipate how the market might react. With MarketReader, users no longer have to guess, because our system connects the dots for you by placing market drivers in the context of actual asset volatility in real time.

Even passive “buy and hold” investors can benefit from MarketReader. Our system highlights the market’s reaction to news or events that might be relevant to your holdings. If you want to be aware of developments, even with your passive investments, MarketReader is built to quickly and simply deliver that information.

MarketReader is also useful for retroactively understanding markets in a “post mortem” sense. In general, the more time passes after the publication of a news item, the harder it is to determine with accuracy what the market response was. But MarketReader’s system makes this easy by allowing users to look at the market reaction to a volatility driver at precisely the moment it happened.

All successful investors need to be aware of what is moving in the market and why. MarketReader helps users understand markets in real-time by putting news and other volatility drivers in a market context. It provides users with the necessary information to make informed decisions, regardless of trading approach.

Sign up for our Insights & Updates list to receive MarketReader news to your inbox, or enroll in our Early Access Community to get the first look at our upcoming product.