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Benefits Of Data Analysis In Stock Market Prediction

CIOInsider Team

The globalized nature of our economy is becoming increasingly complex with each passing year. Every day, millions of transactions are completed resulting in the generation of a gargantuan amount of sensitive data. From business to business transactions to news feeds to tick by tick price updates; it is an arduous task to keep track of all the information in the stock market for a single person. This is where Big Data Analytics comes into the picture and proves to be a lifesaver for individuals and organizations competing in the stock market.

Organizations and Corporations in the financial services sector are using data analytics tools to get insights into the stock market trends in order

to make impactful decisions for their business operations. The stock market is very dynamic in nature as thousands of transactions and events happening every second across the world influences its numbers and figures. With these rapid changes, the investors are left with a vast pool of data. Big Data enables the investors to analyze the data using complex mathematical formulas and algorithms which are fed into the computer. Data Analytics is making trading much more efficient for online traders to make good investment decisions that generate consistent returns.

Algorithmic trading is the latest trend in the financial world. In algorithmic trading, computers analyze the data at a rapid speed giving online traders and investors a real-time accurate picture of the stock market. It provides business firms and trade agencies the opportunity to improve investments. It allows the investors or online traders to peek into the reasons behind a certain market trend, prising and understand price behaviour, which was otherwise impossible to know just a few years back. Access to Big Data helps mitigate possible risks in online trading and enables the investor to make precise decisions. Another useful application in Data analytics is the utilization of Natural Language Processing (NLP). Using NLP computers can analyze and learn from unstructured data and texts.

From large financial institutions to small scale investors, everyone is leveraging the latest trends in data analytics to bring about a positive impact on their investments. Both the human and the computer complement each other perfectly. Humans have the ability to create content and analyze data, and machines, on the other hand, have the ability to process data within the fraction of a second. Data Analysis and Big Data are on the verge of completely revolutionizing how the stock market functions.

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