Scientists at SENSEnews.com Unveil Unprecedented Link Between Online News and Stock Performance, Launch a New Stock Indicator

NEW YORK, Jan 10, 2011 /PRNewswire/ -- Dr. Riza Berkan, founder of hakia and Chief Scientist behind its technology, today launched SENSEnews.com, a service that provides unprecedented insight into the implied value of stocks relative to their current prices. SENSEnews.com illustrates the effect of online news and social media content on stock prices and their well-established inefficiencies to provide reliable short and medium-term value indicators. SENSEnews.com, owned and operated by hakia, Inc., will be accessible to a limited number of participants via subscription for its first phase operation, and will offer enterprise licenses to selected partners in 2011.

SENSEnews is the brainchild of hakia founder Dr. Riza Berkan and the late Dr. Pentti Kouri. Kouri, an economist from MIT, is best known for his academic career at Stanford, Yale and NYU and for his leadership in developing technologies including the PC, VoIP, and mobile phones.

Aggregating all online news and social media information continuously and leveraging state-of-the-art semantic search algorithms, SENSEnews.com shows:

1. A stock's implied valuation relative to its current price,
2. How much of that particular stock should be bought or sold,
3. If the stock is a high "news risk" stock,
4. What stocks make up the best portfolio today,
5. What news items are driving its analysis (news risk) and recommendations

SENSEnews aggregates massive volumes of information containing facts, reported events, fundamentals, financial interpretations, speculation, market factors, sentiments, and reviews to create "algorithmic knowledge" to compute the unrealized, relative value of stocks. Objective-driven information aggregation at this scale, coupled with unparalleled semantic search precision are among the technological advances provided by SENSEnews that enable investors to see and act on market inefficiencies as never before.

Dr. Riza Berkan, co-inventor of SENSEnews and founder & CEO of hakia Inc, noted that, "No human can track, aggregate and analyze massive amounts of emerging information continuously in the way SENSEnews does. SENSEnews empowers investors to be one step ahead in valuing equities before the market adjusts prices to that information."

Roman Frydman, Professor of Economics in New York University, commented that "SENSEnews research is a significant step towards converting the floating market information, such as news and social media content, into tradable analytics." Robert Savage, CEO and co-founder of Track.com, said "The way markets are responding to the news and social media content has never been understood properly; SENSEnews is therefore a milestone achievement in correlating emerging information to price movements, and in quantifying the underlying news risk."

The SENSEnews stock indicator has been tested successfully for individual stocks as well as for major stock indices.  Over a 6-month period, the SENSEnews stock indicator has consistently produced higher returns than that of the DJIA and S&P 500 indices.  

What makes SENSEnews unique is that it is the first scalable demonstration of the assessment of a stock's implied value based solely on news and social media content, and is shown to be consistently profitable for trading purposes. SENSEnews can be an addition to standard fundamental and technical analyses to fill the gap of "news effect on stock prices."   

The current version of the service only analyzes individual stocks, but SENSEnews indicators have been successfully tested on other types of securities as well. SENSEnews offers indices on phenomena that affect markets such as industry trends, political stability, local economies, market environments and regional disasters. SENSEnews research will be expanding toward finding correlations in more complex forms of unstructured data in 2011, such as detecting market manipulations in the Twitter stream.

About the inventors of SENSEnews.com:

Dr. Riza C. Berkan

Founder and CEO of hakia, Dr. Berkan is a nuclear scientist by training with a specialization in artificial intelligence and fuzzy logic. He is the author of several articles in the area of reactor control and diagnostics, including the book Fuzzy Systems Design Principles published by IEEE in 1997. Between 1990 and 2000, Dr. Berkan worked for the US Government and managed multiple projects for Lockheed Martin Energy Systems and Westinghouse. Riza Berkan holds a B.S. in Physics from Hacettepe University, Turkey and an M.S. and Ph.D. in Nuclear Engineering from the University of Tennessee with a specialization in Artificial Intelligence.

Dr. Pentti Kouri (1949 – 2009)

Dr. Kouri was a New York based economist and venture capitalist. He helped to create, fund and manage several technology based startup companies, including most recently hakia, KMOS Inc. and Bandwidth Technology Corporation. A member of the board of Nokia in the 1980's, he taught at Stanford, Yale, New York, and Helsinki Universities, and worked as an economist at the International Monetary Fund.

Prof. Onur Ozgur

Onur Ozgur is an economist at the University of Montreal. He does research on Social and Economic Dynamics and studies the influence of social interactions, norms, customs, fads, rumors, and other social determinants of individual choices on the economy, and on human lives. Prof Ozgur has a B.S. degree from Bogazici University, Turkey, and a Ph.D. in economics from New York University.

For more information, visit SENSEnews.com or contact SENSEnews at [email protected]. Follow SENSEnews on Twitter @SENSEnews and on Facebook

Follow SENSEnews' social media contact on Twitter @toddgailun

SOURCE SENSEnews.com