Can a consumer sentiment based valuation be automated?
For the last month or so I have been devoting all my free time to the development of an idea of using specific consumer sentiment to predict price movement for specific stocks. I now have a working model that correlates sentiment individually and specifically to any given stock price.
I evaluated the top 100 largest cap companies using my methodology and then created a portfolio based on the directional call for any company with correlation coefficient above .5 (~20 stocks). The new portfolio is called "anticiment".
I have spent a lot of evenings building this and sleepless nights thinking about it, so I am not planning on divulging my methodology. I think it is a right of passage to suffer "excel nightmares" (where you wake up every few hours from a dream where excel formulas weren't quite working and you become lost in a world of vast sheets of data) before you get a tool like this (or you pay me a lot of money, either one is fine with me).
Anyway, I will use my "anticiment" profile for testing the tool. You should know that my forecast window is about 3 weeks.
The picks are:
(+/- indicates expected direction.... It is possible that my system has a negative bias that needs to be explored)