Academic Seminar Series
The Market's Mirror: Revealing Investor Disagreement with LLMs
Tony Cookson
Leeds School of Business, University of Colorado Boulder
– Time:
–
Abstract
Large language models (LLMs) can emulate human perspectives. Leveraging this idea, we study how investor disagreement emerges in response to firm news. We endow an LLM with 216 representative investor personas and elicit buy, hold, or sell responses to S&P 500 firm news headlines from 2010-2025. Dispersion in responses yields article-level disagreement for 5.5 million headlines and sheds light on its sources. Disagreement is highest for socially-oriented news and lowest for fundamentals. Persona responses reflect non-pecuniary rationales and align with human-survey benchmarks. Disagreement predicts elevated same- and next-day abnormal trading volume, especially retail, and results persist beyond the LLM’s training cutoff.
Tony Cookson is a Professor of Finance and the Michael A. Klump Endowed Professor at the Leeds School of Business, University of Colorado Boulder. He holds a bachelor’s and master’s degrees from Montana State University and a Ph.D. in Economics from University of Chicago. He has been on faculty at University of Colorado since 2013. Through his research, Dr. Cookson has become an expert on how investors use social media, the casino industry, the political economy of Native American reservations, and the consequences of the fracking revolution for households. His research has been published in leading peer-reviewed journals, including the Journal of Finance, Journal of Financial Economics, Review of Financial Studies, the Journal of Law and Economics, and Management Science. Tony is an editor at the Review of Corporate Finance Studies, as well as an associate editor at the Journal of Financial Economics and Management Science.
This seminar will be online on Teams. Click here to attend
