Australian chief executives are reportedly fine-tuning their market communications to avoid triggering algorithms of data-hungry quant funds that trade on the ASX. This comes amid expectations of a volatile reporting season, where minor deviations from forecasts could lead to significant share price fluctuations. The February reporting period saw stocks move an average 6 per cent on results day, the largest swing in a decade. This volatility, linked to passive investing, is now a regular feature, exemplified by debt collector Credit Corp’s 10 per cent dive after its profit guidance narrowly missed consensus.
In this environment, CEOs are advised against using terms like “albeit,” which can imply uncertainty and activate automated trading responses. Corporate advisory firm Sodali has considered this. Sodali’s head of analytics, Brett Miller, suggests “nominalisations” — like “we decided” over “a decision was made” — to convey conviction. Executives are also encouraged to swap past tense “ed” words for “ing” terms to project a future vision.
While few discuss these linguistic adjustments, ETF Shares chief investment officer David Tuckwell notes the practice is understood to be widespread. Some ASX-listed firms, like explosive manufacturer Orica and professional services firm Worley, deploy AI to counter machine-led trading. Conversely, real estate listings group REA Group and major banks increasingly reference AI on analyst calls.
Experts caution against solely trying to outsmart algorithms, despite the language focus. Sodali’s Brett Miller advises against “beating the machines,” advocating instead for an authentic, durable narrative. University of Melbourne’s Greg Nyilasy warns rhetorical flourishes cannot compensate for poor financial performance. “No amount of avoiding words like ‘albeit’ can save you if you have nothing good,” Nyilasy stated.
