The European Central Bank has introduced the Reddit Retail Investor Sentiment Indicator (R-RISI), an AI-driven tool designed to track the mood of retail traders. The system converts online discussions into a daily sentiment signal that correlates with next-day market returns.
The indicator is based on research by Fabian Wagner and Julian Metzler, published in August 2026 as ECB Working Paper Series No. 3276. The dataset includes 8–9 million posts from 14 investing subreddits, such as r/wallstreetbets and r/stocks, covering the period from 2015 to April 2026.
Researchers utilized ChatGPT-5.1 to classify sentiment and identify discussion topics within the posts. According to the study, this model outperformed FinBERT in processing informal language. The ECB notes that the tool is applicable across various asset classes and individual securities.
The study highlights that the correlation between R-RISI changes and S&P 500 returns is 3.4 times stronger during market drawdowns compared to stable periods. The ECB intends to use this indicator as an early warning system to monitor financial stability, as retail investor behavior has become increasingly speculative.
