FinReport: Explainable Stock Earnings Forecasting via News Factor Analyzing Model

TL;DR

FinReport is an automated system that leverages financial news and multi-factor analysis to generate explainable stock earnings reports, aiding ordinary investors in understanding market impacts and risks.

Contribution

This work introduces FinReport, a novel multi-module system that combines news analysis, return forecasting, and risk assessment for accessible stock earnings reporting.

Findings

Effective in real-world datasets

Provides explainable investment reports

Enhances accessibility for ordinary investors

Abstract

The task of stock earnings forecasting has received considerable attention due to the demand investors in real-world scenarios. However, compared with financial institutions, it is not easy for ordinary investors to mine factors and analyze news. On the other hand, although large language models in the financial field can serve users in the form of dialogue robots, it still requires users to have financial knowledge to ask reasonable questions. To serve the user experience, we aim to build an automatic system, FinReport, for ordinary investors to collect information, analyze it, and generate reports after summarizing. Specifically, our FinReport is based on financial news announcements and a multi-factor model to ensure the professionalism of the report. The FinReport consists of three modules: news factorization module, return forecasting module, risk assessment module. The news factorization module involves understanding news information and combining it with stock factors, the return forecasting module aim to analysis the impact of news on market sentiment, and the risk assessment module is adopted to control investment risk. Extensive experiments on real-world datasets have well verified the effectiveness and explainability of our proposed FinReport. Our codes and datasets are available at https://github.com/frinkleko/FinReport.