Wisdom of crowds: The value of stock opinions transmitted through social media

Hailiang Chen; Prabuddha De; Yu Hu; Byoung Hyoun Hwang

doi:10.1093/rfs/hhu001

Wisdom of crowds: The value of stock opinions transmitted through social media

Hailiang Chen, Prabuddha De, Yu Hu, Byoung Hyoun Hwang^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

714 Citations (Scopus)

Abstract

Social media has become a popular venue for individuals to share the results of their own analysis on financial securities. This paper investigates the extent to which investor opinions transmitted through social media predict future stock returns and earnings surprises. We conduct textual analysis of articles published on one of the most popular social media platforms for investors in the United States. We also consider the readers' perspective as inferred via commentaries written in response to these articles. We find that the views expressed in both articles and commentaries predict future stock returns and earnings surprises.

Original language	English
Pages (from-to)	1367-1403
Number of pages	37
Journal	Review of Financial Studies
Volume	27
Issue number	5
DOIs	https://doi.org/10.1093/rfs/hhu001
Publication status	Published - May 2014
Externally published	Yes

ASJC Scopus Subject Areas

Accounting
Finance
Economics and Econometrics

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abstract = "Social media has become a popular venue for individuals to share the results of their own analysis on financial securities. This paper investigates the extent to which investor opinions transmitted through social media predict future stock returns and earnings surprises. We conduct textual analysis of articles published on one of the most popular social media platforms for investors in the United States. We also consider the readers' perspective as inferred via commentaries written in response to these articles. We find that the views expressed in both articles and commentaries predict future stock returns and earnings surprises.",

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Wisdom of crowds: The value of stock opinions transmitted through social media

Abstract

ASJC Scopus Subject Areas

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