After closing Twitter-based fund, Derwent offers sentiment software to day traders

After closing Twitter-based fund, Derwent offers sentiment software to day traders

Having shuttered its Twitter sentiment-based hedge fund after just one month, Derwent Capital Markets is changing tack and opening up its technology to day traders through a Web site and mobile app.

Derwent launched its £25 million fund last year to much fanfare off the back of research that found that analysing the content of daily Twitter feeds using two mood tracking tools predicted with an 87.6% accuracy the daily ups and downs in the closing value of the Dow Jones Industrial Average.

The company inked a licensing agreement with the researchers to use their algorithm in the real world. Despite a decent performance of just under two per cent growth - ahead of the market and the average hedge fund - the operation was quietly shut down after a month.

Now, according to the FT, Derwent is preparing a new offering for launch this summer which will let users tap its sentiment technology as an overlay on IG Group's spread-betting trading platform.

Paul Hawtin, founder, Derwent Capital, told the New Scientist: "It means that people will be able to monitor global stock sentiment for the first time and use the information to influence their own personal investment decisions."

Comments: (2)

A Finextra member
A Finextra member 26 May, 2012, 12:42Be the first to give this comment the thumbs up 0 likes

How did the fund perform? This would suggest bad or not that great and they decided they could get more - or perhaps just a stable income - from licensing the tech.

Elizabeth Lumley
Elizabeth Lumley - Girl, Disrupted - Crayford 28 May, 2012, 11:49Be the first to give this comment the thumbs up 0 likes

Or maybe the whole thing was just a publicity stunt?