Knowledge Graph Construction for Stock Markets with LLM-Based Explainable Reasoning

TL;DR

This paper introduces a knowledge graph schema for the stock market integrated with large language models, enabling explainable multi-hop reasoning and relational queries for enhanced investment analysis.

Contribution

It presents a novel knowledge graph schema tailored for stock market data, combined with LLMs for explainable reasoning and complex financial question answering.

Findings

Effective extraction of complex financial insights

Enhanced explainability in stock market analysis

Successful validation on Korean companies

Abstract

The stock market is inherently complex, with interdependent relationships among companies, sectors, and financial indicators. Traditional research has largely focused on time-series forecasting and single-company analysis, relying on numerical data for stock price prediction. While such approaches can provide short-term insights, they are limited in capturing relational patterns, competitive dynamics, and explainable investment reasoning. To address these limitations, we propose a knowledge graph schema specifically designed for the stock market, modeling companies, sectors, stock indicators, financial statements, and inter-company relationships. By integrating this schema with large language models (LLMs), our approach enables multi-hop reasoning and relational queries, producing explainable and in-depth answers to complex financial questions. Figure1 illustrates the system pipeline, detailing the flow from data collection and graph construction to LLM-based query processing and answer generation. We validate the proposed framework through practical case studies on Korean listed companies, demonstrating its capability to extract insights that are difficult or impossible to obtain from traditional database queries alone. The results highlight the potential of combining knowledge graphs with LLMs for advanced investment analysis and decision support.