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Study links stock price and online popularity in large corporations

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March 22, 2011

According to a new Pace University study, Starbucks, Coca-Cola and Nike’s social media popularity translates to more than just Facebook “likes” and Twitter followers—it shows a positive correlation with stock price.

Conducted by a Pace researcher in association with Famecount.com and over a 10-month period, the study found a statistically significant correlation between the daily movements in popularity for the brands’ Facebook, Twitter and YouTube accounts and daily stock price movements.

The correlation was also found when a 10 and 30-day lag were introduced, suggesting social media popularity might be a lead indicator in stock price performance.

The number of Facebook likes, Twitter followers and YouTube views for each of the company accounts were tracked against stock movements relative to an index of consumer stocks.

Pace doctoral student Arthur O’Connor compiled the study using data from social media analytics service Famecount.com for the period between April 7 and Feb. 2, 2011.

 

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