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Two ECB economists use ChatGPT to measure retail investor sentiment on Reddit
IA en un minuto newsroom · Editor: Jon Elgezabal
In 30 seconds
Fabian Wagner and Julian Metzler, of the European Central Bank, have used GPT-5.1 to read posts in Reddit investing forums and turn them into an index, the R-RISI, that tracks how retail investors are feeling. According to them, it gives warning earlier than surveys. Its rises and falls are related to the stock market on the following day, especially when the market drops.
Reddit forums may reflect how small investors feel sooner than surveys do. That is the finding of Fabian Wagner and Julian Metzler, two economists at the European Central Bank, in a post published Thursday on the ECB blog.
The authors ran posts from Reddit communities about investing and the economy, such as wallstreetbets, stocks, investing, Bitcoin and Economics, through GPT-5.1, OpenAI's model. It tags each message as positive, negative or neutral, gives it a topic (shares, funds, options, commodities, the macroeconomy, geopolitics, tariffs or crypto-assets) and works out which company or asset it refers to even when no ticker symbol is mentioned. From all of this they build the R-RISI, a gauge of retail investor mood.
According to the authors, the index sends faster and more frequent signals than survey-based indicators, and its moves are linked to what the stock market does the following day, above all on days when prices fall. Because every message carries a topic, the indicator can also be broken down: tariffs dragged it sharply lower in April 2025, for example, and the macroeconomy weighed on it during the COVID-19 shock.
The full study is in a working paper that accompanies the post, and the ECB has opened an online dashboard to explore the index by market, topic and asset.
Why it matters · analysis and opinion
Measuring the market's mood used to depend on surveys, which arrive late; what these two economists propose is to read it almost daily in what people write. For a central bank the appeal is clear, because small investors trade more and more and their activity was hard to see. But this is a research tool, not a trading signal: an index being linked to what happens the next day does not mean it predicts it reliably, and Reddit does not represent every saver. It remains to be seen how it behaves outside the period studied and how much it depends on the model that classifies the posts. For anyone working with customer feedback, the idea carries over: a language model can turn messy text into an indicator that can be tracked.
Official source: ECB · Written with the help of AI: how we make the news
