Monday, May 25, 2009

The Story Behind Markets with Search

Getting macromarket data on a real time basis to influence true market value calculations is the focus of this blog.

The movement of investment markets is centered upon paying what investors believe to be the true market value (TMV) of an underlying asset.  An investor calculates that TMV then looks at the current bid/ask price to identify a chance to profit from a purchase or sale of the asset.  Investing 101 in a nutshell.

There are, of course, millions of factors that can go into calculating that TMV.  Many of those factors are based on data that is released on a lagging basis.  Consumer confidence, unemployment, weekly mortgage applications, and several other data all require us to wait for an aggregation of data before their release to trigger market movements.

What if we didn’t have to wait for this data?

Google started the online predictive market with their release of Flu Trends in late 2008, which uses regional searches for flu symptoms as a real-time indicator of where outbreaks are looming. This is incredibly powerful (and accurate) as CDC data lags two weeks at the very least.

This blog seeks to use powerful tools available to the public such as Google Insights for Search, Twitter Search, Job Trends, and others to apply the flu trends principle to secondary markets.

Thank you for your readership.

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