ECB economists turn to Reddit and AI to read investors' mood
SPY•Two European Central Bank economists used ChatGPT-5.1 to analyze more than nine million Reddit posts and create an indicator of retail investor sentiment. They said it provides more timely, frequent signals than surveys and is associated with next-day market returns, particularly during downturns.
1. Reddit sentiment indicator
The economists analyzed more than nine million Reddit posts with ChatGPT-5.1 to create the Reddit Retail Investor Sentiment Indicator, or R-RISI. It draws on forums including r/wallstreetbets, r/stocks, r/StockMarket, r/investing, r/Bitcoin and r/Economics.
2. Signals during downturns
The authors said the index reflects major market developments and is timelier and higher-frequency than survey-based indicators. Changes in the R-RISI are associated with next-day market returns, particularly during market declines.
