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Quantitative Finance · Glossary

What is Dictionary method, sentiment score, document embedding?

Also known as: dictionary method · sentiment score · document embedding

Definition 12.3 Research Craft: Predictors, Backtests, Measurement, Portfolios · Chapter 12 — Alternative and Text Data

A dictionary method scores a document by counting the words it contains from fixed word lists. A sentiment score is such a measure of tone, for instance the share of negative words, or negative minus positive words over all words. A document embedding maps a document to a vector of real numbers (word counts weighted by rarity, or the output of a trained language model) so that documents with similar content have nearby vectors.

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