The WallStreetBets forum on the Reddit Inc. website on a laptop computer arranged in Hastings-On-Hudson, New York, U.S., on Friday, Jan. 29, 2021. Photographer: Tiffany Hagler-Geard/Bloomberg via Getty Images
The race is on for hedge funds to better understand how social media is moving markets or risk the same fate as the short-sellers who were clobbered by the rally in GameStop shares.
One way to get ahead of these trends is to more closely track subreddits such as /WallStreetBets, which sparked off the recent buying frenzy and is keeping it rolling with a steady stream of messages telling members to "hold the line" on their investment.
But reading every Reddit post is a tough sell for a hedge fund or institutional investor engaged in high-speed, high-volume trading. That's why brothers Christopher and James Kardatzke, founders of Quiver Quantitative, are suddenly getting a lot of interest from Wall Street.
Over the past few days, the Wisconsin-based startup has gotten a steady stream of inquiries from hedge funds asking about how their technology can help them track social media.
"We've been getting a lot of emails from different hedge funds interested in using our data API to basically get data from /WallStreetBets," Christopher Kardatzke, the chief technology officer for Quiver Quantitative, told cheddar. "They want to make sure there isn't this retail investor interest in what they're taking short positions in."
The company, which provides both free and custom application programming interfaces (API), tracks or "scrapes" alternative data sources such as subreddits, Twitter, and Facebook channels — basically any non-financial source that could be relevant to markets.
Fortunately for the startup, it had been scraping the popular subreddit since early 2020.
Technically, that means it was tracking the number of times certain stocks or ticker symbols were mentioned and whether there was a positive or negative sentiment around those stocks.
Looking at the whole year, Quiver found that the "WallStreetBets Portfolio," a breakdown of the top stocks mentioned positively on the subreddit, was up more than 61 percent, was more volatile than the S&P 500, but outperformed it even through the downturn at the start of the year.
Right now, this data is aggregated on a daily basis, but the startup is working on rolling out a real-time feed within the next few weeks.
"It's pretty basic stuff, but we're in the process right now of expanding that into a live feed to get the most recent comments within seconds," the CTO said.
Kardatzke noted that this will be particularly useful to hedge funds, and will fit well with /WallStreetBets, which features daily posts outlining where members plan to invest the following day.
Soon, he added, Quiver will start looking at language more specific to the subreddit, including option trading terms such as puts and calls.
And while Quiver will likely develop some of these inquiries from hedge funds into client relationships, the company plans to maintain its free platform, which Kardatzke said was originally built to help retail rather than institutional investors.
"It's so relevant to retail investors," he said. "It's data you see in your everyday life. You don't need a finance degree to be able to analyze it or get insights from it."
Kardatzke said that he's conscious that the company could soon be straddling both sides of what appears to be a growing rift in the financial world. The way to remedy that is by making sure both sides are catered to. Retail investors, for instance, want more visualizations and analysis, while institutions want APIs to use for their own analysis, he said.
He said that typically data providers only offer the latter, "but we’d like to do everything we can to make insights from our data available to the public, while keeping afloat."
A 2021 report from UK Research and Innovation found that the shipping industry makes up at least 2.5 percent of the world's total CO2 emissions. It's a problem that energy solutions company, Leclanché, is trying to solve. Founded in 1909, the company has been developing and producing batteries for more than 100 years. Today, Leclanché's lithium-ion battery is used to electrify not just ships, but also railroad locomotives, trucks, and specialty vehicles. Cheddar News spoke with Pierre Blanc, chief technology and industrial officer of Leclanché, to discuss.
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"Sing 2" has overthrown "Spider-Man: No Way Home" as the number one film at the UK box office. The animated sequel brought in $8.1 million, in just its two first weekends. However, "No Way Home" is still on track to beat "Avatar" as the number one grossing movie of all time.
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On this episode of Cheddar Reveals, Jim Riordan, Director of the MBA Sport Management program at Florida Atlantic University, breaks down the successes, failures, and chaos of the first seven months of the Name, Image, Likeness policy in college athletics; Adi Kunalic, President of Opendorse, discusses the first-ever association-wide deal in college athletics between Opendorse and the NAIA, and how Opendorse is marketing and educating student-athletes to make the most of their NIL deal potential; Cheddar gets a look at Curiosity Stream's 'Predicting a Pro'.
Jim Riordan, Director of the MBA Sport Management program at Florida Atlantic University, joins Cheddar Reveals to break down the successes, failures, and chaos of the first seven months of the Name, Image, Likeness policy in college athletics.
