SAN FRANCISCO — The torrent of posts on Twitter last year about Netflix might have tipped off investors to stock swings that erased about $8 billion from the movie-rental company’s market value in three months.
Topsy Labs, a site that searches data on the micro- blogging service, analyzed tweets during a period around Netflix’s decision in September to split its DVD and streaming businesses. By examining posts such as “just canceled my Netflix subscription,” Topsy was able to pick up signals of a coming drop. Now, it’s taking those results to help build a new service to aid investors in predicting other stock moves.
“Information dissemination is now largely not through publication but through conversation,” said Rishab Ghosh, co-founder and vice president of research at Topsy, based in San Francisco. “We’ve actually been able to show that you can take that data, put it through processing and relate it to the market return for a specific stock.” Bloomberg News
