Pop Charts to predict the Dow? Research shows there's a correlation between Billboard and Wall Street.
Dr. Phil Maymin is an Assistant Professor of Finance and Risk Engineering at the Polytechnic Institute of New York University. He holds a Ph.D. in Finance from the University of Chicago, a Master's in Applied Mathematics from Harvard University, and a Bachelor's in Computer Science from Harvard University. He is also an award-winning journalist, the author of Yankee Wake Up, and has been a hedge fund portfolio manager too. In a recent study Phil compared the annual average beat variance of the songs in the US Billboard Top 100 since its inception in 1958 through 2007 to the standard deviation of returns of the S&P 500 for the same year. He found there´s a correlation.
Are charted hit songs a potential indicator for stock market behavior? How about Michael Jackson's music?
You've compared rhythmic variation in popular songs with stock market volatility. Please explain and what did you find?
"It seems that song and stock volatility are negatively related, and that if anything the musical choices come first, with market variation following. Songs with lower beat variance (a measure of how much the beat changes) tend to be popular just before the stock market experiences higher volatility."
1 | 2 | 3 all interviews