Exploring Hypergraph of Earnings Call for Risk Prediction (Student Abstract)

Abstract

In financial economics, studies have shown that the textual content in the earnings conference call transcript has predictive power for a firm's future risk. However, the conference call transcript is very long and contains diverse non-relevant content, which poses challenges for the text-based risk forecast. This study investigates the structural dependency within a conference call transcript by explicitly modeling the dialogue between managers and analysts. Specifically, we utilize TextRank to extract information and exploit the semantic correlation within a discussion using hypergraph learning. This novel design can improve the transcript representation performance and reduce the risk of forecast errors. Experimental results on a large-scale dataset show that our approach can significantly improve prediction performance compared to state-of-the-art text-based models.