Markit partners with Social Market Analytics | Financial Industry …
Tim Sargent, MD and head, Markit Indices
“In today’s exceptionally competitive investment arena, timely new insights are key to investment success.”
London & New York – Financial
information services provider Markit has partnered with Social
Market Analytics (SMA) to provide new signals of investor
sentiment to help customers inform their trading strategies or
investment process. The social media indicators enhance the
Markit Research Signals suite which can be used to evaluate
expected performance of stocks-based sentiment indicators.
An analytical study of the social media signals entitled “Alpha:
Extracting Market Sentiment from 140 Characters” concluded that
the signals accurately and consistently predict future stock
returns. From December 2011 to November 2013, Markit’s analysis
found positive social media sentiment stocks have shown
cumulative returns of 76% while negative sentiment stocks have
returned -14%.
Markit’s social media indicators are based on SMA’s analysis of
the text content in daily Twitter posts. Tweets are filtered for
financial trading relevance and scored for market sentiment
content. Using aggregate Tweet data to identify potential buy and
sell candidates, the indicators gauge investor outlook on stocks
covering the following broad categories: tweet sentiment, tweet
volume, relative value, changing sentiment and dispersion.
Tim Sargent, Managing Director and Head of Markit Indices, said:
“In today’s exceptionally competitive investment arena, timely
new insights are key to investment success. We are pleased to
offer our customers SMA’s social media indicators which our
research shows will differentiate their investment research and
strategies.”
Joe Gits, President and CEO of Social Market Analytics, added:
“We’re delighted to have been selected by Markit to be their
exclusive provider of social sentiment signals. Their vetting and
testing process is rigorous, so it is significant that their
independent study found our social sentiment signals highly
predictive of specific stock movement.”
SMA data analyses social media streams to estimate market
sentiment. SMA’s patent pending process extracts relevant tweets,
validates the source and evaluates the meaning. Metrics are
converted into actionable indicators called S-FactorsTM designed
to capture financial market sentiment.
Link:
Markit partners with Social Market Analytics | Financial Industry …
