Elon Musk is a fascinating figure on Twitter. The technology entrepreneur often uses his account to reveal confidential information about Tesla, attack the media and post his favourite memes to his sizeable following – often to the detriment of Tesla’s stock price.
With this in mind, WhoCanFixMyCar has created an interactive dashboard showing how the actions of Elon Musk on Twitter and in the media affects the stock price of Tesla in real-time. You can view the mobile version below, or alternatively view the full-screen version here.
How Does Twitter & Media Sentiment Work?
Find out how both Twitter and media sentiment is measured.
The dashboard collects the first page of tweets that mention Elon Musk or @elonmusk every day and runs them through a sentiment analysis algorithm which tells us if Twitter users are speaking positively or negatively about him, taking into account over 3,000 words. For example, “profits” would be considered positive, while “rant” would be considered negative.
Generally, Twitter sentiment change tends to inversely mirror stock price change. This is because if Elon Musk does something outrageous on Twitter, the average user will find it amusing without thinking of the implications of his actions. So, Musk may be popular on Twitter because he has caused controversy, but Tesla’s stock price will fall.
Similar to Twitter sentiment, we collect the first page of articles from Bing News and run them through a sentiment analysis algorithm to show if the media is talking about Elon Musk in a favourable or unfavourable way. The media sentiment should accurately reflect the variation in Tesla’s stock price due to being aware of the ramifications of Musk’s actions, both on Twitter and in the media. However, our research has shown that this isn’t the case.
Twitter Sentiment is the Best Indicator of Tesla’s Stock Price
We started gathering data on the Twitter and media sentiment of Elon Musk on Tuesday 14th May 2019, and since that time our Twitter sentiment algorithm has been shown to be the best indicator of Tesla’s stock price, with the media lagging behind. WhoCanFixMyCar has selected two key periods over the last three months which demonstrate this:
14th May – 14th June 2019
– Elon Musk reveals on Twitter ‘Starlink’ satellites that will blanket the Earth with internet. (14th May)
– Elon Musk calls for cost control in email to employees, resulting in stock plummeting. (17th May)
– The man behind the “absolute unit” sheep meme is hired by Tesla. (21st May)
– BART and Elon Musk face off on Twitter over transit and tunnels. (28th May)
– Tesla’s pickup will cost under $50,000, rivalling the industry-leading Ford F-150. (3rd June)
– Elon Musk’s tweets prompt SEC official to call for guidelines on CEOs’ social media use. (14th June)
As you can see, the Twitter sentiment towards Elon Musk almost directly reflects that of Tesla’s stock price between 14th May and 14th June 2019. On the 17th May, Tesla’s stock price crashed as Musk sent out an email outlining cost control measures to Tesla employees. There was a 30-40% reduction in his Twitter sentiment during this period following Tesla’s stock price. On the 21st May, Tesla hired the person behind the “absolute unit” sheep meme and Tesla’s stock price and Twitter sentiment began to rise again. However, media sentiment isn’t so accurate at predicting the variability in Tesla stock. You can see the media sentiment compared to the stock price over the same period below.
12th July – 30th July 2019
– Elon Musk in flamethrower war with Pablo Escobar’s brother. (12th July)
– Elon Musk reveals plan for mind-reading implants through his startup, Neuralink. (16th July)
– Microsoft invests in $1bn project co-founded by Elon Musk. (22nd July)
– Tesla loses $408m as technology chief J.B. Straubel departs. (24th July)
– Elon Musk gets $120m more for his tunnel-boring company. (25th July)
– Elon Musk riddles followers, changing his Twitter name to “-1”. (26th July)
Between 24th – 25th July, Tesla lost a reported $408m off their value in one day due to technology chief J.B. Straubel leaving the business. This is reflected in both Twitter and media sentiment, which saw a massive downturn during this period, as people looked to Musk to improve Tesla’s fortunes and respond to the stock price drop. A day later, Musk changed his Twitter name to “-1”, leaving his 27.6m followers mystified.
Our interactive graph shows that Twitter sentiment towards Elon Musk and his tweets is a far more effective tool than what is said about him in the media to judge the direction of Tesla’s stock price. Our graph will remain live to further show how the fate and reputation of Tesla relies on one man, Elon Musk.
Disclaimer: The data within this dashboard is to be used for entertainment purposes only.