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Looking to Twitter for a Market Edge?

If you’re looking for a hot stock tip, consider Twitter. A new paper by Timm O. Sprenger and Isabell M. Welpe looks at the effects of microblogging on stock prices. Sprenger and Welpe compared the “sentiment, message volume, and level of agreement” of tweets with various market indicators.?”Users who provide above-average investment advice are retweeted (i.e., quoted) more often, have more followers and are thus given a greater share of voice in microblogging forums,” the authors write. “In sum, we find that stock microblogs contain valuable information that is not yet fully incorporated in current market indicators.” (HT: Nathan Yang) [%comments]


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