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August 28, 2015

Wall Street's top shrink analyzes market turmoil

  • Richard Peterson of MarketPsych says if you're a buy-and-hold investor, stop paying attention. Reacting to the market's swings is probably the worst thing you can do.
    • By MATTHEW CRAFT
    AP Business Writer

    NEW YORK — When it seems like the stock market has lost its mind, big banks and investment firms often turn to one particular psychiatrist: Richard Peterson, CEO of MarketPsych, a firm that applies research from behavioral science to financial markets.

    MarketPsych's computer programs attempt to gauge the market's mood by scanning news and Twitter and other social media. The data feed it sells to traders sifts through more than 3 million articles each day, registering confusion, optimism and fear. Last month, Peterson warned his investor clients that they were in for a rough ride and probably “a real correction” later in the summer. “Fear is creeping in,” he said.


     
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