Millions of messages about trivial matters are posted on Twitter every day, but one group of hedge fund managers are using them as a crystal ball for market fluctuations - and it's having a big impact.
Analysts at London’s Derwent Capital Markets - described as 'Europe's first social media-based hedge fund' - has launched a £25million fund based on research that suggests tweets foretell whether markets will go up or down.
It shows that if the mood of the population goes up, the market follows. The Mayfair company use a program that scans Twitter for keywords to work out what the world's 'mood' is - and invest money accordingly. And so far the results have been positive.
'Derwent Capital has reported a 1.8 per cent rise in their first month of trading when the U.S. main index has dropped by 2.2 per cent,' said Duane Jackson, who launched KashFlow, which is Britain’s best-selling cloud-based accountancy package, six years ago.
The Twitter-analysis program was written by Johan Bollen, professor of informatics and computing at Indiana University and he used it to predict market movements at the Dow Jones in New York with 87.6 per cent accuracy last October.
http://www.dailymail.co.uk/sciencetech/ ... z1XrwpRckKAnalysts at London’s Derwent Capital Markets - described as 'Europe's first social media-based hedge fund' - has launched a £25million fund based on research that suggests tweets foretell whether markets will go up or down.
It shows that if the mood of the population goes up, the market follows. The Mayfair company use a program that scans Twitter for keywords to work out what the world's 'mood' is - and invest money accordingly. And so far the results have been positive.
'Derwent Capital has reported a 1.8 per cent rise in their first month of trading when the U.S. main index has dropped by 2.2 per cent,' said Duane Jackson, who launched KashFlow, which is Britain’s best-selling cloud-based accountancy package, six years ago.
The Twitter-analysis program was written by Johan Bollen, professor of informatics and computing at Indiana University and he used it to predict market movements at the Dow Jones in New York with 87.6 per cent accuracy last October.
