Abstract
With more and more investors exerting their voices through network forums or social media platforms, the relationships between online investor sentiment and stock movements have drawn more and more attention. In this paper, we crawl stock comments from China’s most popular online stock forum, East Money (www.eastmoney.com), and then develop a sentiment classifier using the LSTM method. Using the online investor sentiment of the stock forum, we explore the effect of online investor sentiment on the stock movements of CSI300. The results show that online investor sentiment has a significant positive impact on both stock return and trading volume and remains significant after controlling book-to-market ratio, BETA, and market value. Moreover, investor sentiment has a significant positive impact on order imbalance of big trade, which represents the main flow of money in the market. As a result, investor sentiment has a positive impact on the major fund flows in the market. In other words, an increase in investor sentiment can boost the major money flows in the market to some extent. From a practical point of view, investor sentiment can assist investors to make investment decisions and help the government to regulate the stock market.
Highlights
Individual investors move to online stock forums or social media platforms to find information on stocks and to express opinions and comments related to stocks. e individual investor generated contents (IIGC) on these platforms have relations to stock movements in two ways
Our objective is to investigate whether online investor sentiment has a significant effect on stock movements in Shanghai Stock Exchange (SHSE) and Shenzhen Stock Exchange (SZSE) in China. e Chinese stock market has its own characteristics that differ from those in developed
We investigate the relationships between online investor sentiment and stock movements in SHSE and SZSE
Summary
Individual investors move to online stock forums or social media platforms to find information on stocks and to express opinions and comments related to stocks. e individual investor generated contents (IIGC) on these platforms have relations to stock movements in two ways. Individual investors move to online stock forums or social media platforms to find information on stocks and to express opinions and comments related to stocks. E individual investor generated contents (IIGC) on these platforms have relations to stock movements in two ways. Online stock comments are emotional reflections of individual investors whose decision-making is influenced by their emotions. Some investors may use online stock comments as input for their investment decisions. The role of online stock forums or social media platforms in the stock market has drawn more and more attention from researchers and practitioners. We call investor sentiment that is derived from IIGC online investor sentiment. Most research on this topic uses data in stock markets of developed countries more than emerging markets of developing countries. Emerging stock markets in developing countries may have features that differ from those in developed countries
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
