Trading on Sentiment

<p>In his debut book on trading psychology, <i>Inside the Investor’s Brain</i>, Rich­ard Peterson demonstrated how managing emotions helps top investors outperform. Now, in <i>Trading on Sentiment</i>, he takes you inside the science of crowd psychol­ogy and demonstrates that not only do price patterns exist, but the most predictable ones are rooted in our shared human nature.</p> <p>Peterson’s team developed text analysis engines to mine data - topics, beliefs, and emotions - from social media.  Based on that data, they put together a market-neutral social media-based hedge fund that beat the S&P 500 by more than twenty-four percent—through the 2008 financial crisis. In this groundbreaking guide, he shows you how they did it and why it worked. Applying algorithms to so­cial media data opened up an unprecedented world of insight into the elusive patterns of investor sentiment driving repeating market moves. Inside, you gain a privi­leged look at the media content that moves investors, along with time-tested techniques to make the smart moves—even when <i>it doesn’t feel right</i>. This book digs underneath technicals and fundamentals to explain the primary mover of market prices - the global information flow and how investors react to it.  It provides the expert guidance you need to develop a competitive edge, manage risk, and overcome our sometimes-flawed human nature.  Learn how traders are using sentiment analysis and statistical tools to extract value from media data in order to:</p> <ul> <li>Foresee important price moves using an understanding of how investors process news.</li> <li>Make more profitable investment decisions by identifying when prices are trending, when trends are turning, and when sharp market moves are likely to reverse.</li> <li>Use media sentiment to improve value and momentum investing returns.</li> <li>Avoid the pitfalls of unique price patterns found in commodities, currencies, and during speculative bubbles</li> </ul> <p><i>Trading on Sentiment </i>deepens your understanding of markets and supplies you with the tools and techniques to beat global markets— whether they’re going up, down, or sideways.</p>