Next Article in Journal / Special Issue
Economic Complexity: Correlations between Gross Domestic Product and Fitness
Previous Article in Journal
On the Calculation of Sample Entropy Using Continuous and Discrete Human Gait Data
Previous Article in Special Issue
The Virtuous Interplay of Infrastructure Development and the Complexity of Nations

How News May Affect Markets’ Complex Structure: The Case of Cambridge Analytica

The Department of Environmental Sciences, Informatics and Statistics (DAIS), Ca’ Foscari University of Venice, Venezia 30123, Italy
Center for the Humanities and Social Change, Venezia 30123, Italy
Istituto dei Sistemi Complessi (ISC)-CNR, UOS Sapienza, Roma 00185, Italy
LIMS London Institute of Mathematical Sciences, London W1K 2XF, UK
Author to whom correspondence should be addressed.
Entropy 2018, 20(10), 765;
Received: 31 July 2018 / Revised: 2 October 2018 / Accepted: 3 October 2018 / Published: 6 October 2018
(This article belongs to the Special Issue Economic Fitness and Complexity)
The claim of Cambridge Analytica, a political consulting firm, that it was possible to influence voting behavior by using data mined from the social platform Facebook created a sudden fear in its users of being manipulated; consequently, even the market price of the social platform was shocked.We propose a case study analyzing the effect of this data scandal not only on Facebook stock price, but also on the whole stock market. To such a scope, we consider 15-minutes prices and returns of the set of the NASDAQ-100 components before and after the Cambridge Analytica case. We analyze correlations and Mutual Information among components finding that assets become more correlated and their Mutual Information grows higher. We also observe that correlation and Mutual Information are mutually increasing and seem to follow a master curve. Hence, the market appears more fragile after the Cambridge Analytica event. In fact, as it is well-known in finance, an increase in the average value of correlations augments the systemic risk (i.e., all the market can collapse as a whole) and decreases the possibility of allocating a safe investment portfolio. View Full-Text
Keywords: social media; complex networks; financial series social media; complex networks; financial series
Show Figures

Figure 1

MDPI and ACS Style

Peruzzi, A.; Zollo, F.; Quattrociocchi, W.; Scala, A. How News May Affect Markets’ Complex Structure: The Case of Cambridge Analytica. Entropy 2018, 20, 765.

AMA Style

Peruzzi A, Zollo F, Quattrociocchi W, Scala A. How News May Affect Markets’ Complex Structure: The Case of Cambridge Analytica. Entropy. 2018; 20(10):765.

Chicago/Turabian Style

Peruzzi, Antonio, Fabiana Zollo, Walter Quattrociocchi, and Antonio Scala. 2018. "How News May Affect Markets’ Complex Structure: The Case of Cambridge Analytica" Entropy 20, no. 10: 765.

Find Other Styles
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.

Article Access Map by Country/Region

Back to TopTop