Twitter linked to Stock Market Predictions?

Researchers at the University of Manchester, England and Indiana University have performed a study that has found a correlation between the mood of Tweets and the United States Stock Market (Dow Jones Industrial Average).  A measurement of “calmness” conveyed in tweets predicted Dow Jones closes three to four days later with an 87.6% accuracy.  An investment firm in London is so impressed that it’s launching a Twitter-based fund.

What’s interesting about this analysis of Twitter moods is that out of the six states GPOMS measures – happiness, kindness, alertness, sureness, vitality and calmness – it’s the last one, calmness, that’s most useful in predicting stock market changes.

The researchers admit that they don’t know why or how this selection of Twitter.com user feeds was able to make predictions so accurate, and they say more research is needed.

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Listening – Your new competitive advantage

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Obtaining a Competitive Advantage

What’s your Competitive Advantage?

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