Social Insights About the Stock Market

The avenues for disseminating information around global financial markets are vast. One place that this conversation is taking place in a rather interesting way is on Twitter. There are innumerable ways that this type of conversation can be followed and studied. This article for the sake of tracing a specific theme has decided to focus on two common hashtags, which are both used in reference to the U.S. stock market. These hashtags refer to two stock exchanges in the U.S.: #Dow and #Nasdaq.
This analysis began with a quick and simple search for mentions. It revealed that since January 1, 2014 up until the present, #Dow was used about 100,000 times while #Nasdaq has been mentioned over 400,000 times. Adding to this difference was a surprising fact revealed after a deeper analysis of these posts. #Dow was being used outside of mere financial conversations, such as in reference to the chemical company. This implied that the difference between these hashtags was even greater than originally understood.
Another exciting insight related to #pennystock or #pennystocks were used more than a million times over the same time period.

These numbers are clearly useful but they do not tell us anything about the nature of these conversations. How, in other words, are we to understand ‘what’ people are talking about in these tweets? One problem, as we previously noted, was the use of #Dow in ways outside of references to the stock exchange. Fortunately, within the ForSight™ platform, there is a way to classify these discussions as off-topic to the conversation we are truly interested in following. This allowed us in this analysis to focus only on those tweets using #Dow in the proper context. The results were quite interesting. Dow and Nasdaq Analysis People mentioning #Dow in their tweets were much more inclined to discuss financial conversations in terms of reporting. They would share both their optimism and pessimism. In addition, they would report neutrally as well, saying things like, “stocks are mixed today;” they also passed on information in regard to daily closing market prices. Recommendations, the fourth category observed, made up only 11% of the conversation. In contrast, #Nasdaq produced for us a very different picture. Only 25% of conversation was related to reporting (this included the three categories, positive, neutral and negative). The remaining 75% was allocated to the recommendations category, indicating that this hashtag has become associated, through usage, with people plugging their own stock tips through tweets.

Another interesting metric derived from both these analyses was the days of the week these conversations were being had. The ForSight is able to aggregate this information in such a way as to show which days of the week, over a period of time, average the most or least activity. As you can see from the graphs below, #Dow conversation peaks on Wednesdays and Thursdays, while #Nasdaq is not only consistently higher each day, but sees its highest levels on Tuesdays and Thursdays.
Dow and Nasdaq day and time
The last items that this analysis examined were the Affinities™ associated with those using both of these hashtags. In short, Affinities show us what the interests are of the groups posting and to what extent/degree they have these leanings; these behind the scenes interests are being contrasted with the overall Twitter audience (this is their reference point). In the case of both monitors, we see a set of very strong and similar Affinities. This is not the case with many monitors. Affinities or interests often find themselves more dispersed.
Dow and Nasdaq Affinities
As one might expect, the strongest Affinities fell under the banner of finance and economics. Some concrete examples of these Affinities were: Investing, Currencies, World News, Trading, and Stock Markets.
The interesting piece of data is how incredibly strong each of these interests or passions were. For example, the “Trading” Affinity in the #Nasdaq analysis showed an interest or affinity 190x greater than the average Twitter user.
“Investing” in the #Dow analysis exhibited an interest 132x greater than the average Twitter user. This is not merely a qualitative metric; it also represents an important quantitative element as well. In the case of “Trading,” this given interest can be ascribed to over 33% of the total posts mentioning #Nasdaq. Similarly, “Investing” represented over 34% of total posts in the #Dow analysis. Therefore, both in terms of quantity as well as quality, these given Affinities were quite strong. And these are just two examples. There were plenty of other Affinities from each of the analyses we could have examined.
One of the more interesting insights that can be gleaned from this last section of data is the divide between people engaging in the discussions around these two hashtags and those not doing so. It is often said that there is a disconnect between the world of finance and the average person, whose interactions with this world are more passive and indirect. The interests of people participating in stock market conversations on Twitter are not only fairly predictable but also quite strong in comparison to those not involved in these exchanges. This contrast adds traction to the argument that a gulf does exist between these two audiences. But in our case, this is not merely an opinion; rather, it is an insight based on social data.
For additional insights into financial discussions over social media, download our case study on AMEX Bluebird and the initial consumer response

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