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Investing in Stock Markets with Social Network Analysis

A segment of a social network

Federico Colecchia, a network researcher at ATALAB, wrote to the SOCNET mailing list: "I am looking for recent/ongoing research on application of social network analysis technologies to analysis of stock values."

(He works as a researcher and R&D coordinator for development of visual intelligence software tools for multiple applications. His current focus is on drug discovery support.)

We traded emails about the use of social network analysis in the financial markets.

He wrote: "The works I know of are econophysical approaches to hierarchical characterization of stock price evolution that have been developed by Mantegna and Stanley. I think the primary references here are: R. Mantegna, H. E. Stanley, "An Introduction to Econophysics – Correlations and Complexity in Finance", Cambridge University Press, 2000 R. Mantegna (1999). "Hierarchical Structure in Financial Market", The European Physical Journal B 11:193-7."

He also mentioned chiresearch (contact Jonathon Mote, Center for Innovation, University of Maryland) and Francis Narin’s work on social network analysis-based methodologies for patent analysis, with a focus on identification of companies in which to invest. Does anyone have other suggestions on investors who are using social network analysis for investing? Of course, Nitron Advisors is one indirect example.

(Image via Wikipedia)

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