Quantifying semantic shift in financial NLP: Robust metrics for market prediction stability

Financial news is essential for accurate market prediction, but evolving narratives across macroeconomic regimes introduce semantic and causal drift that weaken model reliability. We present an evaluation framework to quantify robustness in financial NLP under regime shifts. The framework defines four metrics: (1) Financial Causal Attribution Score (FCAS) for alignment with causal cues, (2) Patent Cliff Sensitivity (PCS) for sensitivity to semantic perturbations, (3) Temporal Semantic Volatility (TSV) for drift in latent text representations, and (4) NLI-based Logical Consistency Score (NLICS) for entailment coherence. Applied to LSTM and Transformer models across four economic periods (pre-COVID, COVID, post-COVID, and rate hike), the metrics reveal performance degradation during crises. Semantic volatility and Jensen-Shannon divergence correlate with prediction error. Transformers are more affected by drift, while feature-enhanced variants improve generalisation. A GPT-4 case study confirms that alignment-aware models better preserve causal and logical consistency. The framework supports auditability, stress testing, and adaptive retraining in financial AI systems.

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Publication Details

Journal
Kent Academic Repository (University of Kent)
Published
2025-11-14
DOI
https://doi.org/10.1145/3768292.377040
Primary Topic
Stock Market Forecasting Methods
Type
article
Field-Weighted Citation Impact
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article

Quantifying semantic shift in financial NLP: Robust metrics for market prediction stability

Anoushka Harit, Zhongtian Sun, Jongmin Yu, Chenghao Xiao
Kent Academic Repository (University of Kent)
Stock Market Forecasting Methods
article

Quantifying semantic shift in financial NLP: Robust metrics for market prediction stability

Anoushka Harit, Zhongtian Sun, Jongmin Yu, Chenghao Xiao
article en

Abstract

Financial news is essential for accurate market prediction, but evolving narratives across macroeconomic regimes introduce semantic and causal drift that weaken model reliability. We present an evaluation framework to quantify robustness in financial NLP under regime shifts. The framework defines four metrics: (1) Financial Causal Attribution Score (FCAS) for alignment with causal cues, (2) Patent Cliff Sensitivity (PCS) for sensitivity to semantic perturbations, (3) Temporal Semantic Volatility (TSV) for drift in latent text representations, and (4) NLI-based Logical Consistency Score (NLICS) for entailment coherence. Applied to LSTM and Transformer models across four economic periods (pre-COVID, COVID, post-COVID, and rate hike), the metrics reveal performance degradation during crises. Semantic volatility and Jensen-Shannon divergence correlate with prediction error. Transformers are more affected by drift, while feature-enhanced variants improve generalisation. A GPT-4 case study confirms that alignment-aware models better preserve causal and logical consistency. The framework supports auditability, stress testing, and adaptive retraining in financial AI systems.

Kent Academic Repository (University of Kent)
Openalex Percentile: Top 22%
Stock Market Forecasting Methods
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