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Finding Memes for Contrarian or Trend-following Plays

| | Posted in: Animal Spirits, Individual Investing

The Internet enables rapid flow and ebb of trading memes. Trend followers hope to ride a meme and get out before it fades. Contrarians take the other side in anticipation of the fade. Traditional tools for inferring memes include price-volume action and market sentiment. Do emerging information-filtering technologies present novel ways of discovering investing/trading memes from surges of news on the web? Building on ideas offered in the article “Finding Signals in the Noise” from Technology Review, we offer a few possible meme-detectors:

The following news and blog aggregators/filters may indicate what topics are capturing the attention of investors and traders en masse, either via traditional news channels or through blogs. Most offer a search function to narrow the range of items aggregated. The list is not exhaustive but suggests a range of thinking on how to manage the Internet torrent and, thereby, discover current memes. We expect not all these sites will survive.

Bloglines search on “stock market”: “Bloglines is a server-based aggregation system. This means that we run and manage all of the software and technologies necessary to collect the syndicated feeds from tens of millions of online information sources on our own computer servers and databases, and deliver that amazing content to you as a free, easy-to use online service.”

Blogniscient Business: “At Blogniscient, blogs and blog articles are organized by category. Within each category, you can look at the top-ranked sources in one of four forms: 1) Top Blogs – these are the blogs containing the largest amount of information on the topics that are hot right now 2) Top Articles – these are the articles that received the most attention in a particular category 3) Freshest Stuff – these are the latest posts from the blogs in a particular category.”

Digg search on “stock market”: “Digg is a technology news website that employs non-hierarchical editorial control. With digg, users submit stories for review, but rather than allowing an editor to decide which stories go on the homepage, the users do.” [This site is for technology meme traders – no business or financial market focus.]

Findory Business News and Findory Business Blogs: “News, weblogs, and advertising are just the beginning. Every day, we are all subject to an overwhelming flood of information. Findory will help by providing focus and surfacing the information you need.”

Google News – Business: “Google News has no human editors selecting stories or deciding which ones deserve top placement. Our headlines are selected by computer algorithms, based on factors including how often and on what sites a story appears online. This is very much in the tradition of Google web search, which relies heavily on the collective judgment of online publishers to determine which sites offer the most valuable and relevant information.”

Inform Financial Markets (under Business tab): “Inform’s differentiating technology uses a series of information structuring techniques and natural-language interpretation to auto-categorize and group news stories…”

memeorandum: “The Web is humming with discussions on politics and current affairs. memeorandum is page A1 for these conversations. Auto-updated every 5 minutes, it uncovers the most relevant items from thousands of news sites and weblogs.” [This site is for political meme traders – no business or financial market focus.]

Topix.net Business News: “Topix.net [provides] users the ability to quickly and easily find targeted news on the Internet. With thousands of news sources continually releasing stories twenty-four hours a day, finding relevant news can often be a time consuming task… Topix.net alleviates this problem by creating thousands of topically driven, specific news web pages…”

In summary, rapid meme detection via Internet-enabled technologies may offer an edge for tuned-in traders.

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