Are you looking to invest in the stock market?
If so, you’ve likely decided to look at market trends, studied strategies such as support and resistance, and gone with your pure intuition! But have you considered sentiment analysis?
This is a strategy where one considers the market sentiments to help make the best decisions with stock trading.
You want to know what the market thinks so that you can buy or sell accordingly.
Here are the most popular sentiment analysis applications:
1. Social Media Monitoring
Social media is perhaps the most popular avenue where internet users express their sentiments toward a company or industry. As such, this is a crucial tool for sentiment analysis.
As such, you want to look at social media to see the sentiments toward the stock market. For example, if you see Tweets or Instagram videos praising the new iPhone, you might want to consider checking the price of the Apple stock.
While social media is still a relatively new form of communication, it’s likely that it’ll play a bigger role in stock trading in the future.
2. Brand Monitoring
The next popular sentiment analysis application is brand monitoring. This lets you keep an eye on a brand’s reputation.
If a brand has a great reputation, it’s likely that the stock price will rise. One can also lose their fortune if a brand falls from grace.
With brand monitoring, you’ll get information on what the market sentiments toward popular companies are. You should collect this information over time to make your decision with stock trading.
You must know that a fall from grace or bad publicity doesn’t mean that the stock price will fall. As such, take your time with keeping records of a brand’s reputation for several months before placing trades.
3. Voice of Employee
Of course, it’s not always what the market thinks that matters. The employees of a particular company can also have an effect on its performance in the stock market.
With Voice of Employee, you’ll monitor how employees feel about their company. These can include reading online reviews or hearing first-hand testimonials.
This type of market sentiment isn’t considered by many stock traders. However, it’s likely that it may have a bigger impact on a stock’s performance than one may think.
When you start stock sentiment analysis you must know what the workers are saying about their business. Hearing from the CEO isn’t sufficient!
For example, Amazon has a poor reputation for how it treats its factory workers. Will this affect its stock performance in the future? What if Tesla has a great reputation for how it treats its staff? Can we expect this to increase Tesla’s stock value?
Make sure you find a great service such as StockGeist.ai that allows you to keep track of these 3 market sentiments.
Use These Sentiment Analysis Applications
Now you can use these sentiment analysis applications to help you make better decisions with stock trading.
You should start with social media monitoring. The impact of social media on a stock’s performance shouldn’t be underestimated. You want to take advantage of this sentiment analysis.
You’ve also got to keep an eye on a brand’s reputation through brand monitoring. Hearing a firsthand account from a brand’s employees will also help you predict the future of a stock’s performance.
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