Israeli-developed smartphone app gives stock tips

Software scans 15,000 Web sources, giving picture of which shares are being talked about.

Iphone 1 311 (photo credit:
Iphone 1 311
(photo credit:
Veterans of the IDF’s elite intelligence unit 8200 have been behind many of Israel’s greatest hi-tech success stories in the past, including instant messaging pioneer ICQ, fraud detection company NICE Systems, and security software firm Check Point. Now the latest product that unit alumni have contributed to is the Wall Street Scanner, a new iPhone app launched last month that scans digital media and financial analysis to provide a consensus forecast on stock prices.
Developed by Ramat Gan-based company Sentigo, the app sorts through 15,000 different sources on the web, tapping into information from financial analysts, bloggers and digital media sites such as Twitter to provide consumers with an overall picture of which shares are being talked about and what the sentiment is.
“We wanted to bring something that was missing at the moment to the consumer,” company founder and CEO Gadi Shvadron told The Jerusalem Post.
At present, 70 million Americans view more than three billion web pages each month in their search for stock market information, he said. “The regular person does not feel comfortable looking at all the information. There is too much of it available and not enough bottom line indicators.”
Enter Wall Street Scanner, which scans around 2200 different stocks every second of the day, reading more than seven million web pages over 24 hours and extracting only the most relevant information by filtering out the work of PR agents or unreliable sources.
That way, “We can see if there is a spike in the level of mentioning of a specific stock, we can see if something is happening,” Shvadron said.
Thanks to a team of army intelligence veterans led by VP of Research & Development Yiftah Ben Aharon and algorithmic researcher Prof. Ely Porat, the app has three main components that differentiate it from other sources, Shvadron said.
The first component is an engine that is analytical and monitors social conversation and news about stocks on the Internet; the second is that it knows how to integrate realtime market data to indicate when unusual behavior occurs in a stock, so that users can be notified immediately; and finally, the app includes a statistical engine with historical data, which allows it to predict future movements based on past trends.
Shvadron, who previously founded recruitment website, said the reason for launching the product first as an app rather than online, is because “many people want to know during the day what is happening to their shares and not to suddenly find out when they get to their PC that they have dropped by seven percent.”
The app, which was downloaded 60,000 times in its first four weeks, has already been reviewed by several prominent American financial writers. Although most reviews have been generally positive, Forbes blogger Peter Cohan wrote that he tested the scanner’s forecasts on 12 different shares over two particular days, and found that the scanner was correct in only five of its predictions.
In response to the criticism, Shvadron told the Post that it doesn’t take into account that the app is based only on probability, and rather than promising where shares will head, intends only to give a more accurate “statistical indication” than those from individual analysts. Shvadron said that industry data show that analysts correctly predict the next-day results of Wall Street shares only 50.5% of the time, while until now “we can say that 54.3% of our forecasts have been right.”
He added that everybody who uses the app knows that it is based on statistical probabilities only, and that it is important they see it as just a tool for predicting the direction of stocks and not as a sign of a sure bet.
As its name suggests, the Wall Street Scanner is currently only available for the US, but plans are underway to offer it for the London and Toronto stock exchanges soon. Although launched originally for the iPhone, the company expects to soon launch apps for other smartphones, as well as a web-based version.