A giant hedge fund used artificial intelligence to analyze Fed minutes ― here’s what it found

Thomson ReutersTraders work on the floor of the NYSE Two Sigma does things differently. The giant hedge fund, which manages $35 billion, is as much a technology company as it is a hedge fund. It uses advanced technologies to find investment opportunities, and just hosted its annual artificial intelligence competition. One of those technological applications involves using natural language processing (NLP) techniques to analyze the Fed minutes, like those published Wednesday afternoon. “Historically, interpretations of those minutes required art, so Fed watchers pontificated and critiqued,” the firm said in a note. “Now natural language processing techniques can translate those minutes into relatively objective data.” Here are the key takeaways from the study (emphasis ours): A bigger emphasis on financial markets – At its peak in late 2008, the FOMC devoted nearly 37 percent of its…


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