Hedge fund managers in London analyze tweets to predict share price patterns.

Traders have used an awareness of the population’s collective emotions to predict price movements for years.

However, experts found that the instant nature of Twitter meant that those emotions could be gauged more accurately.

Previously, it had been thought that a drop in the markets led to more negative feelings but it proved to be the other way around.

Analysts at Derwent Capital Markets in Mayfair, central London, have launched a £25m fund that makes its investments by evaluating whether people are generally happy, sad, anxious or tired, because they believe it will predict whether the market will move up or down.

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