Can Twitter be Used to Analyse the Financial Markets?

Sep 26, 2011, 06:01 ET from City Index

LONDON, September 26, 2011 /PRNewswire/ --

Market experts from spread betting and CFD trading provider City Index ( frequently share news and insights from the trading floor on social networking site Twitter. With the ever-increasing amount of market information posted by its members, Twitter may be becoming a useful market analysis tool for innovative investors.

Thousands of stock-related tweets are sent every day. Traders often mark these tweets with company stock symbols (for example, posts about British Airways stock may feature "GB:BAY"), which makes it simple for you to search for related information.

A recent study by Timm Sprenger, PhD student at the Technical University of Munich, analysed a sample of 250,000 tweets posted over a period of six months. Sprenger discovered "a striking co-ordination" between the Twitter consensus about stocks and the external information from spread betting and financial trading analysts.

"I don't think it is the Holy Grail to make millions but it is a very credible and legitimate source," states Timm Sprenger. He also found that more valuable information tended to be retweeted, therefore connecting with a larger audience.

Twitter may eventually provide a more specialised version of its Trending Topics feed. Until then, traders who tweet can follow spread betting insights via feeds such as @Josh_CityIndex, and @Sandy_CityIndex to keep up with  news and analyses from City Index trading experts such as Joshua Raymond and Sandy Jadeja .

Find out more about market analysis at City Index at:

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As a group, we transact in excess of 1.5 million trades every month for individuals in over 50 countries worldwide. We provide access to a wide range of instruments including margined foreign exchange, contracts for differences (CFDs) and, in the UK, financial spread betting.

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SOURCE City Index