Twitter Absolute Return Fund
Firm Launching Hedge Fund Trading Based on Twitter
Derwent’s Absolute Return Fund will debut in February with £25 million. The firm has engaged a University of Manchester computer science professor to build the trading models. That professor, Xioa-Jun Zeng, worked on a paper published in October about using Twitter to predict movements in the Dow.
The hedge fund is in talks with the other two authors, Indiana University’s Johan Bollen and Huina Mao, about coming on board.
“Sentiment and mood dramatically change the impact of positive and negative new stories,” Derwent’s Paul Hawtin told Bloomberg News. “If the market’s in a very positive and bullish mood, it can shrug off bad news—bad news comes out and you expect the Dow to fall, and it doesn’t.” Source