Can Google predict the stock market?

Anna Fedorova
clock

An analysis of changes in Google query volume for search terms related to finance reveals patterns that could be interpreted as early-warning signs of stock market moves.

Tobias Preis, of Warwick Business School, Helen Susannah Moat, of University College London, and H. Eugene Stanley, of Boston University analysed changes in the frequency of 98 terms, such as ‘revenue', ‘unemployment', ‘credit' and ‘nasdaq', in Google searches from 2004 to 2011. The researchers found that using these changes in search volume as the basis of a trading strategy investing in the Dow Jones Industrial Average index could have led to substantial profit. In their paper entitled Quantifying Trading Behavior in Financial Markets, published in Nature Publishing Group's Scientif...

To continue reading this article...

Join Investment Week

  • Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
  • Get ahead of regulatory and technological changes affecting fund management
  • Important and breaking news stories selected by the editors delivered straight to your inbox each day
  • Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
  • Be the first to hear about our extensive events schedule and awards programmes

Join now

 

Already an Investment Week
member?

Login

Trustpilot