# Enhancing Financial Sentiment Analysis via Retrieval Augmented Large Language Models

arXiv: https://arxiv.org/abs/2310.04027 · HTML: https://mlsanity.com/paper/2310.04027/

## Key facts

- Cited by 68 papers in the map (data through 14 Oct 2026).
- Placed in Legal and financial RAG, one of 15 directions in Retrieval-augmented generation.
- Builds on 22 of its 36 references that are in the map.
- First posted on arXiv 6 Oct 2023.

## Placed in

- Retrieval-augmented generation / [Legal and financial RAG](https://mlsanity.com/rag/legal-and-financial-rag/)

## Builds on (most cited first, 22 of 22)

- [Language Models are Few-Shot Learners](https://mlsanity.com/paper/2005.14165/) (2020)
- [Training language models to follow instructions with human feedback](https://mlsanity.com/paper/2203.02155/) (2022)
- [LLaMA: Open and Efficient Foundation Language Models](https://mlsanity.com/paper/2302.13971/) (2023)
- [Retrieval-Augmented Generation for Knowledge-Intensive NLP Tasks](https://mlsanity.com/paper/2005.11401/) (2020)
- [Finetuned Language Models Are Zero-Shot Learners](https://mlsanity.com/paper/2109.01652/) (2021)
- [Switch Transformers: Scaling to Trillion Parameter Models with Simple and Efficient Sparsity](https://mlsanity.com/paper/2101.03961/) (2021)
- [Neural Machine Translation of Rare Words with Subword Units](https://mlsanity.com/paper/1508.07909/) (2015)
- [Self-Instruct: Aligning Language Models with Self-Generated Instructions](https://mlsanity.com/paper/2212.10560/) (2022)
- [Decoupled Weight Decay Regularization](https://mlsanity.com/paper/1711.05101/) (2017)
- [Multitask Prompted Training Enables Zero-Shot Task Generalization](https://mlsanity.com/paper/2110.08207/) (2021)
- [LaMDA: Language Models for Dialog Applications](https://mlsanity.com/paper/2201.08239/) (2022)
- [BloombergGPT: A Large Language Model for Finance](https://mlsanity.com/paper/2303.17564/) (2023)
- [GLM-130B: An Open Bilingual Pre-trained Model](https://mlsanity.com/paper/2210.02414/) (2022)
- [FinBERT: Financial Sentiment Analysis with Pre-trained Language Models](https://mlsanity.com/paper/1908.10063/) (2019)
- [Good Debt or Bad Debt: Detecting Semantic Orientations in Economic Texts](https://mlsanity.com/paper/1307.5336/) (2013)
- [FinGPT: Open-Source Financial Large Language Models](https://mlsanity.com/paper/2306.06031/) (2023)
- [Generation-Augmented Retrieval for Open-domain Question Answering](https://mlsanity.com/paper/2009.08553/) (2020)
- [FinBERT: A Pretrained Language Model for Financial Communications](https://mlsanity.com/paper/2006.08097/) (2020)
- [Retrieval Augmented Code Generation and Summarization](https://mlsanity.com/paper/2108.11601/) (2021)
- [Retrieval-Augmented Generation for Code Summarization via Hybrid GNN](https://mlsanity.com/paper/2006.05405/) (2020)
- [Instruct-FinGPT: Financial Sentiment Analysis by Instruction Tuning of General-Purpose Large Language Models](https://mlsanity.com/paper/2306.12659/) (2023)
- [Large Language Model Instruction Following: A Survey of Progresses and Challenges](https://mlsanity.com/paper/2303.10475/) (2023)

## Built on by (most cited first, 30 of 68)

- [A Survey on RAG Meeting LLMs: Towards Retrieval-Augmented Large Language Models](https://mlsanity.com/paper/2405.06211/) (2024)
- [Revolutionizing Finance with LLMs: An Overview of Applications and Insights](https://mlsanity.com/paper/2401.11641/) (2024)
- [A Survey of Large Language Models for Financial Applications: Progress, Prospects and Challenges](https://mlsanity.com/paper/2406.11903/) (2024)
- [BadRAG: Identifying Vulnerabilities in Retrieval Augmented Generation of Large Language Models](https://mlsanity.com/paper/2406.00083/) (2024)
- [Follow My Instruction and Spill the Beans: Scalable Data Extraction from Retrieval-Augmented Generation Systems](https://mlsanity.com/paper/2402.17840/) (2024)
- [EmoLLMs: A Series of Emotional Large Language Models and Annotation Tools for Comprehensive Affective Analysis](https://mlsanity.com/paper/2401.08508/) (2024)
- [RAGChecker: A Fine-grained Framework for Diagnosing Retrieval-Augmented Generation](https://mlsanity.com/paper/2408.08067/) (2024)
- [RAG vs. GraphRAG: A Systematic Evaluation and Key Insights](https://mlsanity.com/paper/2502.11371/) (2025)
- [Designing Heterogeneous LLM Agents for Financial Sentiment Analysis](https://mlsanity.com/paper/2401.05799/) (2024)
- [Parameter-Efficient Fine-Tuning in Large Models: A Survey of Methodologies](https://mlsanity.com/paper/2410.19878/) (2024)
- [Deficiency of Large Language Models in Finance: An Empirical Examination of Hallucination](https://mlsanity.com/paper/2311.15548/) (2023)
- [FinRobot: An Open-Source AI Agent Platform for Financial Applications using Large Language Models](https://mlsanity.com/paper/2405.14767/) (2024)
- [TelecomGPT: A Framework to Build Telecom-Specfic Large Language Models](https://mlsanity.com/paper/2407.09424/) (2024)
- [A Survey on Knowledge-Oriented Retrieval-Augmented Generation](https://mlsanity.com/paper/2503.10677/) (2025)
- [Embedding-based classifiers can detect prompt injection attacks](https://mlsanity.com/paper/2410.22284/) (2024)
- [Affective Computing in the Era of Large Language Models: A Survey from the NLP Perspective](https://mlsanity.com/paper/2408.04638/) (2024)
- [Harnessing Earnings Reports for Stock Predictions: A QLoRA-Enhanced LLM Approach](https://mlsanity.com/paper/2408.06634/) (2024)
- [Reassessing Layer Pruning in LLMs: New Insights and Methods](https://mlsanity.com/paper/2411.15558/) (2024)
- [Emotion Detection for Misinformation: A Review](https://mlsanity.com/paper/2311.00671/) (2023)
- [FinDER: Financial Dataset for Question Answering and Evaluating Retrieval-Augmented Generation](https://mlsanity.com/paper/2504.15800/) (2025)
- [CPA-RAG:Covert Poisoning Attacks on Retrieval-Augmented Generation in Large Language Models](https://mlsanity.com/paper/2505.19864/) (2025)
- [MarketSenseAI 2.0: Enhancing Stock Analysis through LLM Agents](https://mlsanity.com/paper/2502.00415/) (2025)
- [CTSyn: A Foundation Model for Cross Tabular Data Generation](https://mlsanity.com/paper/2406.04619/) (2024)
- [FinLoRA: Benchmarking LoRA Methods for Fine-Tuning LLMs on Financial Datasets](https://mlsanity.com/paper/2505.19819/) (2025)
- [AuditLLM: A Tool for Auditing Large Language Models Using Multiprobe Approach](https://mlsanity.com/paper/2402.09334/) (2024)
- [AI in Investment Analysis: LLMs for Equity Stock Ratings](https://mlsanity.com/paper/2411.00856/) (2024)
- [Large Language Models for Subjective Language Understanding: A Survey](https://mlsanity.com/paper/2508.07959/) (2025)
- [A Large Language Model-Empowered Agent for Reliable and Robust Structural Analysis](https://mlsanity.com/paper/2507.02938/) (2025)
- [Retrieval-Augmented Generation in Industry: An Interview Study on Use Cases, Requirements, Challenges, and Evaluation](https://mlsanity.com/paper/2508.14066/) (2025)
- [Large Language Model Enhanced Knowledge Representation Learning: A Survey](https://mlsanity.com/paper/2407.00936/) (2024)

## Abstract (arXiv)

Financial sentiment analysis is critical for valuation and investment decision-making. Traditional NLP models, however, are limited by their parameter size and the scope of their training datasets, which hampers their generalization capabilities and effectiveness in this field. Recently, Large Language Models (LLMs) pre-trained on extensive corpora have demonstrated superior performance across various NLP tasks due to their commendable zero-shot abilities. Yet, directly applying LLMs to financial sentiment analysis presents challenges: The discrepancy between the pre-training objective of LLMs and predicting the sentiment label can compromise their predictive performance. Furthermore, the succinct nature of financial news, often devoid of sufficient context, can significantly diminish the reliability of LLMs' sentiment analysis. To address these challenges, we introduce a retrieval-augmented LLMs framework for financial sentiment analysis. This framework includes an instruction-tuned LLMs module, which ensures LLMs behave as predictors of sentiment labels, and a retrieval-augmentation module which retrieves additional context from reliable external sources. Benchmarked against traditional models and LLMs like ChatGPT and LLaMA, our approach achieves 15% to 48% performance gain in accuracy and F1 score.