• Corpus ID: 233864404

Should You Take Investment Advice From WallStreetBets? A Data-Driven Approach

@article{Buz2021ShouldYT,
  title={Should You Take Investment Advice From WallStreetBets? A Data-Driven Approach},
  author={Tolga Buz and Gerard de Melo},
  journal={ArXiv},
  year={2021},
  volume={abs/2105.02728}
}
Reddit’s WallStreetBets (WSB) community has come to prominence in light of its notable role in affecting the stock prices of what are now referred to asmeme stocks. Yet very little is known about the reliability of the highly speculative investment advice disseminated on WSB. This paper analyses WSB data spanning from January 2019 to April 2021 in order to assess how successful an investment strategy relying on the community’s recommenda­ tions could have been. We detect buy and sell advice and… 

Tables from this paper

Place Your Bets? The Market Consequences of Investment Research on Reddit's Wallstreetbets

We examine the market consequences of due diligence (DD) reports on Reddit’s Wallstreetbets (WSB) platform. We find average ‘buy’ recommendations result in two-day announcement returns of 1.1%.

WallStreetBets Beyond GameStop, YOLOs, and the Moon: The Unique Traits of Reddit’s Finance Communities

While the effect of established social media on stock markets has been thoroughly investigated, the recent surge in retail investing and the emergence of different finance-related Reddit communities

Modelling Financial Markets during Times of Extreme Volatility: Evidence from the GameStop Short Squeeze

Ever since the start of the coronavirus pandemic, lockdowns to curb the spread of the virus have resulted in an increased interest of retail investors in the stock market, due to more free time,

Characterizing Social Movement Narratives in Online Communities: The 2021 Cuban Protests on Reddit

Social movements are dominated by storytelling, as narratives play a key role in how communities involved in these movements shape their identities. Thus, recognizing the accepted narratives of

Short, Colorful, and Irreverent! A Comparative Analysis of New Users on WallstreetBets During the Gamestop Short-squeeze

TLDR
A comparative analysis between long-term users and newcomers and examine their respective writing styles, topics, and susceptibility to community feedback finds that new users are less prone to select their subsequent message topics based on past community feedback.

Turning Stocks into Memes: A Dataset for Understanding How Social Communities Can Drive Wall Street

TLDR
A dataset of communications centered on the GameStop phenomenon is developed to analyze the subscriber intention behaviors within the r/WallStreetBets community to buy (or not buy) stocks and can provide insight to social scientists on the persuasive power of social movements online by adopting common language and narrative.

Self-induced consensus of Reddit users to characterise the GameStop short squeeze

TLDR
A model of opinion dynamics where user engagement can trigger a self-reinforcing mechanism leading to the emergence of consensus, which in this particular case is associated to the success of the short squeeze operation is introduced.

Self-induced emergence of consensus in social networks: Reddit and the GameStop short squeeze

TLDR
This work characterises the structure and time evolution of Reddit conversation data, showing that the occurrence and sentiment of GME-related comments (representing how much users are engaged with GME) increased significantly much before the short squeeze actually took place, and introduces a model of opinion dynamics where user engagement can trigger a self-reinforcing mechanism leading to the emergence of consensus on the short squeezing operation.

References

SHOWING 1-10 OF 22 REFERENCES

YOLO trading: Riding with the herd during the GameStop episode

The Equity Market Implications of the Retail Investment Boom

Retail trading activity has soared during the COVID-19 pandemic. This paper quantifies the impact of the retail investment boom on the US stock market within a structural model. Using account

Did David Win a Battle or the War Against Goliath? Dynamic Return and Volatility Connectedness between the GameStop Stock and the High Short Interest Indices

Can a short-squeeze incident trigger financial contagion over the entire stock markets? The recent GameStop frenzy provides a unique natural experiment to explore this question. In this study, we

Counter-Hegemonic Finance: The Gamestop Short Squeeze

The events that surrounded the short squeeze of various downtrodden stocks such as Gamestop (GME) allude to a counter-hegemonic financial effort, with small-scale investors pooling in to sabotage the

Who Participated in the GameStop Frenzy? Evidence from Brokerage Accounts

In January 2021, the GameStop stock was at the epicenter of the first case of predatory trading initiated by retail investors. In this paper, we use brokerage accounts to study who participated in

Clearing prices under margin calls and the short squeeze

In this paper, we propose a clearing model for prices in a financial market due to margin calls on short sold assets. In doing so, we construct an explicit formulation for the prices that would result

Social Media Sentiment in International Stock Returns and Trading Activity

Abstract The authors investigate the impact of social media on S&P index constituents for U.S., European, and emerging markets with the international investor perspective using firm-specific Twitter

The Pushshift Reddit Dataset

TLDR
The Pushshift Reddit dataset makes it possible for social media researchers to reduce time spent in the data collection, cleaning, and storage phases of their projects.

Social Media, Sentiment and Public Opinions: Evidence from #Brexit and #Uselection

TLDR
The results suggest that the aggressive use of Twitter bots, coupled by the fragmentation of social media and the role of sentiment, increases the polarization of public opinions about the EU Referendum and the US Election.