Alpha in Social Sentiment: Thinning the Crowd
Social media analytics are among the hottest technologies in the capital markets. But filtering the noise from social media such as Twitter to uncover the real alpha-generating opportunities remains a major challenge. According to CEO Igor Gonta, Market Prophit takes a unique quantitative approach to filtering tweets, relying solely on the accuracy and predictive power of those tweets while ignoring the popularity of the individuals behind them. But Market Prophit doesn't stop there, Gonta tells TABB Group analyst Valerie Bogard; the company drills down further, performing its analysis on the individual security level and identifying the top influencers with the highest predictability for any given stock. Gonta and Bogard discuss the use of social sentiment in the pursuit of alpha beyond high-frequency strategies.