Came across this from slashdot, apparently Derwent Capital has created an algo to forecast market moves off twitter sentiment with relatively high accuracy.
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The number of emotional words on Twitter could be used to predict daily moves in the Dow Jones Industrial Average. A change in emotions expressed online would be followed between two and six days later by a move in the index, the researchers said, and this information let them predict its movements with 87.6 percent accuracy (historically)
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This is in line with the idea of text based sentiment estimation. There's a number of quant finance research effort around this area, though I haven't seen much of it from practicing firms. Perhaps they just aren't talking about it. Remember the Hot Chicks Indicator? yeah, it's kinda like that.
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