Sunday, November 14, 2010

Who Needs Stock Charts?

Throw away the technical analysis book; all you need is Google's search metrics.


The researchers found the search activity on a particular company name increased in tandem with increased trading activity of the company stock as a whole - whether the stock price went up or went down. “Increasing transaction volumes of stocks coincide with an increasing search volume and vice versa,” the study authors wrote.

“Thus, one can conclude that search volume reflects the present attractiveness of trading a stock. But it seems that neither buying transactions nor selling transactions are preferred when one detects an increased volume,” the study said.


There you go. The increased search activity means the stock is going to go either up or down. Nice that it narrows it down.

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