The BSE has introduced a data analytics-based, artificial intelligence mechanism that tracks the performance of listed companies in relation to news about those companies on digital and social media platforms, like Twitter.
“The primary objective of the verification is that the mechanism will detect and mitigate potential risks of market manipulation, rumour, and reduce information asymmetry arising from digital media platforms, including from social media,” BSE said in a press statement. “It provides accurate information involving listed companies and the BSE through the exchange website for the benefit of investors.”
The solution employs a combination of statistical modelling and big data analytics.
Alerts generated by this social media solution will be closely monitored by the exchange from the standpoint of material information and also vis-à-vis possible rumours appearing in various media, including print and online channels, the BSE said.
“Any differences observed therein are required to be explained by the companies, and their responses are then disseminated on the exchange website for the benefit of investors and market participants for taking informed decisions,” the statement added.
Last month, the securities market regulator SEBI made a series of proposals on further regulating who could give investment advice. Among these proposals was a suggested ban on “trading tips” disseminated through SMSes, WhatsApp and other messaging platforms. The proposals are open for public discussion and response.
“Any material news or rumour in social media can have a very big potential for impacting the sentiments of the investing population, which can further impact the price/ volumes of the securities traded on the exchange platforms,” the BSE note said. The new capability at the BSE will likely monitor the effects of such news in the real trading world.