Reliable Financial Named Entity Recognition Under Domain Shift: Confidence Estimation and Selective Prediction

Financial named-entity recognition (NER) is essential for translating unstructured financial reports and news into structured knowledge graphs. However, general-purpose large language models (LLMs) often misclassify financial entities or ignore domain-specific patterns. This paper investigates the use of DeepSeek-R1-8B, a recent open-source large language model, combined with Low-Rank Adaptation (LoRA) and Noisy Embedding Fine-Tuning (NEFTune) for financial NER. Each annotated sentence in our corpus of 1693 samples is converted into an instruction-input-output triple. We insert lightweight LoRA matrices into the Transformer layers and apply NEFTune to improve generalisation by adding uniform noise to embedding vectors during training. Experiments show that the LoRA-adapted DeepSeek-R1-8B achieves a micro-F1 of 0.901 on seven entity types (Company, Date, Location, Money, Person, Product and Quantity), and adding NEFTune further boosts the micro-F1 to 0.912, outperforming Llama3-8B, Qwen3-8B, Baichuan2-7B, T5 and BERT-Base baselines.

Financial Numerical Entity (FNE) understanding aims to recover the meaning of numerical mentions in financial reports. Existing studies focus on concept name prediction and face two important limitations. First, labels derived from inline XBRL may contain errors because filings are usually prepared manually. Second, other important FNE attributes, such as reporting-time relation, measurement scale, and accounting sign, are less emphasized. We propose NOise-Robust Tagging for Rich Financial Numerical Entity Attributes (NORA) to address these gaps. NORA uses task-aware instance-specific weighting to attenuate the influence of noisy labels during training, and we develop an evaluation protocol that filters noisy labels in real-world test sets. In addition, we construct a large-scale benchmark containing 11.4 million FNEs in 6.3 million sentences with multi-attribute labels and filing metadata. Experiments show that NORA performs strongly compared with previous financial numeric tagging models and noisy-label baselines. Under both unfiltered and noise-filtered test settings, it achieves the best mean Accuracy and Macro F1 over the four attributes, with the largest gain on time-relation prediction, while remaining competitive on concept name, scale, and sign. These results demonstrate the value of modeling rich FNE attributes with document context while accounting for label noise in real-world financial filings.

Financial sentiment classifiers are commonly evaluated against human labels, but strong linguistic performance does not necessarily imply economically useful return predictability. This study separates these questions through two experiments. First, we construct a unified three-class benchmark from five financial text datasets and compare TF--IDF Naive Bayes, off-the-shelf FinBERT and Financial-RoBERTa encoders, zero-shot Qwen2.5-7B, and QLoRA-adapted Qwen2.5-7B, LLaMA3-8B, and Mistral-7B models. Mistral-7B achieves the best test accuracy (0.8840) and macro-F1 (0.8771), while QLoRA raises Qwen2.5's macro-F1 from 0.7274 to 0.8615. An inverse-frequency class-weighted loss does not improve Qwen2.5. Second, we evaluate economic validity on a temporally separate 2019 Benzinga sample containing 10,637 unique headlines and 13,115 headline--stock observations for a fixed S&P~100 universe. Model probabilities are converted into continuous sentiment scores, aggregated by stock and signal date, and aligned with next-session returns over one-, two-, three-, and five-day horizons. All seven downstream models produce positive but small mean rank information coefficients at the one-day horizon; the largest is 0.0143 for FinBERT. None of the 28 model--horizon tests remains significant after Newey--West inference and false-discovery-rate correction. Portfolio results likewise fail to establish a robust advantage for the best-performing classifiers. The findings show that QLoRA is effective for financial sentiment adaptation, while also documenting a clear gap between classification accuracy and tradable cross-sectional signals.