Twitter 'can predict the stock market'

Post Reply
User avatar
Pappa
Non-Practicing Anarchist
Non-Practicing Anarchist
Posts: 56488
Joined: Wed Feb 18, 2009 10:42 am
About me: I am sacrificing a turnip as I type.
Location: Le sud du Pays de Galles.
Contact:

Twitter 'can predict the stock market'

Post by Pappa » Thu Oct 21, 2010 8:00 am

I read this in the free rag on the train this morning.
http://www.metro.co.uk/tech/844648-twit ... ock-market
Twitter 'can predict the stock market'

Forget a degree in economics, a bumper salary and a wardrobe full of striped shirts with white collars – if you really want to know what’s going to happen in the City, just log on to Twitter.

Movements in the stock market can be predicted by looking at messages posted on the micro-blogging website, according to new research.

The mood of the public, measured by the number of emotional words in millions of Tweets, reflected the rise and fall of the market to an accuracy of almost 90 per cent, research at Indiana University found.
Scientists ran computer tests on 9.8million tweets from 2.7million tweeters, counting the number of times they used emotional adjectives like ‘friendly’ or ‘panicky’. Researchers examined the mood during major events – which proved to be ‘anxious’ the day before the US presidential election – but discovered a remarkable correlation when they compared it to the Dow Jones Index.
‘There are so many people using these online social networks right now that we think they have become a major factor in shaping public sentiment, and as a result in shaping our society and our economy,’ said Prof Johan Bollen.

User avatar
mistermack
Posts: 15093
Joined: Sat Apr 10, 2010 10:57 am
About me: Never rong.
Contact:

Re: Twitter 'can predict the stock market'

Post by mistermack » Thu Oct 21, 2010 9:21 am

Ha, what they're talking about is "reflecting" the stock market, not predicting it.
Anybody can reflect it, but you don't make any money reflecting.
An accurate forecast is hard. An accurate podcast, dead easy.
.
While there is a market for shit, there will be assholes to supply it.

User avatar
Pappa
Non-Practicing Anarchist
Non-Practicing Anarchist
Posts: 56488
Joined: Wed Feb 18, 2009 10:42 am
About me: I am sacrificing a turnip as I type.
Location: Le sud du Pays de Galles.
Contact:

Re: Twitter 'can predict the stock market'

Post by Pappa » Thu Oct 21, 2010 9:43 am

mistermack wrote:Ha, what they're talking about is "reflecting" the stock market, not predicting it.
Anybody can reflect it, but you don't make any money reflecting.
An accurate forecast is hard. An accurate podcast, dead easy.
.
Well, that depends. If the mood can predict likely movement a day, an hour or even a minute before, then that's still a form of prediction.

I was more interested in this as yet another nail in the "rational agents" coffin.
http://en.wikipedia.org/wiki/Rational_agent
For information on ways to help support Rationalia financially, see our funding page.


When the aliens do come, everything we once thought was cool will then make us ashamed.

User avatar
klr
(%gibber(who=klr, what=Leprageek);)
Posts: 32964
Joined: Wed Mar 04, 2009 1:25 pm
About me: The money was just resting in my account.
Location: Airstrip Two
Contact:

Re: Twitter 'can predict the stock market'

Post by klr » Thu Oct 21, 2010 9:47 am

That's the problem with the stock market in the short-term. Stocks rise and fall for reasons that have nothing to do with the underlying fundamentals. :roll:
God has no place within these walls, just like facts have no place within organized religion. - Superintendent Chalmers

It's not up to us to choose which laws we want to obey. If it were, I'd kill everyone who looked at me cock-eyed! - Rex Banner

The Bluebird of Happiness long absent from his life, Ned is visited by the Chicken of Depression. - Gary Larson

:mob: :comp: :mob:

User avatar
Pappa
Non-Practicing Anarchist
Non-Practicing Anarchist
Posts: 56488
Joined: Wed Feb 18, 2009 10:42 am
About me: I am sacrificing a turnip as I type.
Location: Le sud du Pays de Galles.
Contact:

Re: Twitter 'can predict the stock market'

Post by Pappa » Thu Oct 21, 2010 9:57 am

klr wrote:That's the problem with the stock market in the short-term. Stocks rise and fall for reasons that have nothing to do with the underlying fundamentals. :roll:
There have been some great articles in the New Scientist about the stock market over the past few years. Apparently, market traders' brains behave identically to gamblers in high stress trading situations, they also fall for the same logical fallacies as other types of gamblers and are highly prone to a herd mentality.

Economists are notoriously adverse to backing up their models/claims with any kind of evidence based reasoning. Many assumptions about how markets are supposed to behave are just plain wrong, but they keep using unproven models/concepts nonetheless.
For information on ways to help support Rationalia financially, see our funding page.


When the aliens do come, everything we once thought was cool will then make us ashamed.

User avatar
mistermack
Posts: 15093
Joined: Sat Apr 10, 2010 10:57 am
About me: Never rong.
Contact:

Re: Twitter 'can predict the stock market'

Post by mistermack » Tue Oct 26, 2010 7:08 pm

Pappa wrote:Economists are notoriously adverse to backing up their models/claims with any kind of evidence based reasoning. Many assumptions about how markets are supposed to behave are just plain wrong, but they keep using unproven models/concepts nonetheless.
Are they perhaps closely related to climate scientists?
While there is a market for shit, there will be assholes to supply it.

User avatar
Pappa
Non-Practicing Anarchist
Non-Practicing Anarchist
Posts: 56488
Joined: Wed Feb 18, 2009 10:42 am
About me: I am sacrificing a turnip as I type.
Location: Le sud du Pays de Galles.
Contact:

Re: Twitter 'can predict the stock market'

Post by Pappa » Tue Oct 26, 2010 11:29 pm

mistermack wrote:
Pappa wrote:Economists are notoriously adverse to backing up their models/claims with any kind of evidence based reasoning. Many assumptions about how markets are supposed to behave are just plain wrong, but they keep using unproven models/concepts nonetheless.
Are they perhaps closely related to climate scientists?
Far from it. Climate scientists models are nothing like economists ones.

User avatar
Robert_S
Cookie Monster
Posts: 13416
Joined: Tue Feb 23, 2010 5:47 am
About me: Too young to die of boredom, too old to grow up.
Location: Illinois
Contact:

Re: Twitter 'can predict the stock market'

Post by Robert_S » Wed Oct 27, 2010 1:54 am

Pappa wrote:
mistermack wrote:Ha, what they're talking about is "reflecting" the stock market, not predicting it.
Anybody can reflect it, but you don't make any money reflecting.
An accurate forecast is hard. An accurate podcast, dead easy.
.
Well, that depends. If the mood can predict likely movement a day, an hour or even a minute before, then that's still a form of prediction.

I was more interested in this as yet another nail in the "rational agents" coffin.
http://en.wikipedia.org/wiki/Rational_agent
Now that they've published this, the effect will be amplified.


Do serious people really still think people behave as economically rational agents? Let me rephrase that... do people who still claim that people are rational economic agents get taken seriously?
What I've found with a few discussions I've had lately is this self-satisfaction that people express with their proffessed open mindedness. In realty it ammounts to wilful ignorance and intellectual cowardice as they are choosing to not form any sort of opinion on a particular topic. Basically "I don't know and I'm not going to look at any evidence because I'm quite happy on this fence."
-Mr P

The Net is best considered analogous to communication with disincarnate intelligences. As any neophyte would tell you. Do not invoke that which you have no facility to banish.
Audley Strange

User avatar
Pappa
Non-Practicing Anarchist
Non-Practicing Anarchist
Posts: 56488
Joined: Wed Feb 18, 2009 10:42 am
About me: I am sacrificing a turnip as I type.
Location: Le sud du Pays de Galles.
Contact:

Re: Twitter 'can predict the stock market'

Post by Pappa » Wed Oct 27, 2010 3:06 pm

Robert_S wrote:Do serious people really still think people behave as economically rational agents? Let me rephrase that... do people who still claim that people are rational economic agents get taken seriously?
I think so. Economist seem impervious to the concept of evidence-based models.
For information on ways to help support Rationalia financially, see our funding page.


When the aliens do come, everything we once thought was cool will then make us ashamed.

Post Reply

Who is online

Users browsing this forum: No registered users and 6 guests