HOW IT WORKS

Comments from Reddit and Twitter are stored and passed through a Machine Learning algorithm, assigning a sentiment score. Then these comments are run against a table containing known stock names, tickers, and aliases to see if that stock was mentioned in the comment. If a match is identified, the sentiment score is added to that stocks running total for the day. At the end of each day, all of the sentiment values are averaged, to get a picture of what the net sentiment value was for the stock.

Next, these sentiment values are trended against the closing daily stock price, to show how well the sentiment score matched the daily change in stock price. We see that on average, when there are major changes in stock price, this is also seen in the sentiment value. However, there are times that the sentiment value is a leading indicator for the stock price, working as an alert that there will be a change. This can be particularly powerful on non-trading days, such as weekends and holidays, as the sentiment can give an indication for upcoming stock movement.

This relationship is stongest when the number of comments for a particular stock is high, allowing for a larger pool to analyze.

DISCLAIMER

This site is aimed at providing additional insights for retail investors to utilize in their personal trading efforts, however none of the information within is meant to provide assurances of future activity and no member of our team claims to be a financial adviser.

CONTACT

Please feel free to direct any messages to thesocialchatter@gmail.com