November 12, 2026 (New York time). Two European Central Bank economists have described a way to track retail-investor sentiment using millions of public Reddit posts and a language model. The research is interesting for people building analytics products because it tests whether noisy online discussion can become a timely indicator—not because it proves a profitable trading strategy.
What the researchers reported
Fabian Wagner and Julian Metzler analyzed more than nine million posts from investment-related Reddit communities, including r/stocks, r/wallstreetbets and r/Bitcoin. Their Reddit Retail Investor Sentiment Indicator (R-RISI) uses ChatGPT-5.1 to classify sentiment. According to Reuters’ November 12 report on the economists’ ECB blog, the resulting series broadly tracks established sentiment measures while providing more frequent observations.
The researchers also found an association between changes in the index and next-day market returns, particularly during downturns. An association is not proof that sentiment causes prices to move, and a research finding is not a live trading signal.
Why software builders should care
This is a useful example of turning unstructured text into a time series with a documented methodology. The difficult work is not merely prompting a model: it is sampling representative posts, handling bots and duplicates, preventing information leakage, and checking whether conclusions survive changes in model, market regime and time window.
A practical experiment
- Choose a small, permitted public discussion dataset and define a fixed historical period.
- Write a transparent sentiment rubric and label a human-reviewed sample before running any model.
- Aggregate scores by day, reporting sample sizes and uncertainty rather than a single confident number.
- Compare the index with a simple baseline using forward-only validation and transaction-cost assumptions.
- Publish failure cases, drift and data-use limitations alongside any promising results.
Limitations and source
Reddit users are not a representative sample of all investors; coordinated posting, moderation changes and model updates can distort the series. The reported relationship may disappear out of sample. This article is independent developer analysis, not investment advice.
Original reporting: Reuters, November 12, 2026, 10:06 UTC (5:06 a.m. EST). Research attributed to ECB economists Fabian Wagner and Julian Metzler.
