Predicting the Market with the Wisdom of Crowds | Vuk Vuković

 

 

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How Transparency and Thought Leadership Attract Investors

Can collective intelligence outperform traditional market predictions? By analyzing social networks and identifying the most reliable voices, this approach uncovers hidden patterns in market movements. Data-driven insights, strategic filtering, and public transparency turn behavioral trends into actionable investment strategies.

Can social media predict the stock market?

Vuk Vukovic, CIO and co-founder of Oraclum Capital, believes it can. His hedge fund leverages the wisdom of the crowd and a proprietary network analysis of social media bubbles to forecast weekly equity market movements. With a PhD in political economics and a track record of accurately predicting elections—including Brexit and Trump—he’s now applying his methodology to finance.

Vuk started by testing his theory transparently, using his own money and publishing every move in a newsletter. The results? Turning $1,000 into $54,000 in just two years. His audience didn’t just watch—they invested. Half of his initial hedge fund backers came from readers who followed his journey.

The secret isn’t just crowd wisdom. It’s about identifying and weighting opinions correctly. Some people—especially those stuck in echo chambers—make terrible predictors. Vuk’s method filters out the noise, finding the right voices to forecast market trends with over 60% accuracy.

Beyond trading, he’s expanding his thought leadership through speaking, writing, and his new book, Elite Networks: The Political Economy of Inequality. By connecting network theory to both financial markets and political influence, he’s building a broader platform for his ideas.

Listen in as we explore the intersection of thought leadership, data-driven forecasting, and the power of social media.

Three Key Takeaways

The Wisdom of Crowds Works—If You Filter the Right Voices Crowd predictions are powerful, but only when analyzed correctly. Vuk’s methodology accounts for social media bubbles and bias, identifying the most reliable predictors rather than just following the loudest opinions.

Transparency Builds Trust—and Attracts Investors. By publicly testing his trading model with his own money, Vuk proved its effectiveness. His thought leadership strategy—sharing real results in a newsletter—turned followers into hedge fund backers.

Network Theory Applies Beyond Finance. Vuk’s research on elite influence and inequality connects directly to his market prediction model. Whether in politics or finance, understanding how people interact within networks provides a competitive edge.

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Transcript

Peter Winick And welcome, welcome, welcome. This is Peter Winick. I’m the founder and CEO at Thought Leadership Leverage. And you’re joining us on the podcast, which is Leveraging Thought Leadership. Today. My guest is Vuk Vuković, and Vuk is the CIO and co-founder of Oraclum  Capital, which is a hedge fund that uses wisdoms of the crowd and a proprietary network analysis of social media bubbles to predict weekly equity market moves. He’s got a Ph.D. in political economics and is just an all-around super smart and interesting guy. So welcome aboard.

Vuk Vuković Thanks, Peter. Thanks for having me.

Peter Winick So tell us a little bit about your journey, because there’s an academic piece and then there’s the hedge fund piece. So it’s really interesting that you sit in a bunch of different areas here, but give us the short version of your journey as a thought leader.

Vuk Vuković So yeah. So the academic piece kind of translated into the hedge fund piece. Right. So that was that was kind of the path, right? I used to work in academia before, so I had my, as you mentioned, my PhD from Oxford and I with my two colleagues, one of which is PhD from physics and the other was a PhD of computer science. We wanted to write a paper that does this new methodology of making predictions what you mentioned. Right. So using wisdom of crowds and network analysis to try to make better inferences than regular polls and other prediction methods, however ones. And we tested this on elections, we tested on students fresh but then on elections. And once it was really, really good with predicting Brexit and Trump back in 2016, we decided not to write the paper, but to go with the with the companies that. And so we founded the company. So it became part of our academic endeavors. Essentially, it was kind of a right, it morphed into it. And that was a company that did mostly market research and elections and stuff from 2016. And then after 2020, after we made the Biden prediction. So another one that was an election that was called really, really accurately this time for a lot of paint lines. And then we decided, let’s try to see if this works on markets, on predicting like weekly market moves. So you know, the S&P 500, is it going up or down on a weekly basis. And it did. I took two years of testing I took my own money $2,000. No money borrowed up to 54,000 over two years. Did it all in the newsletter. So it was public. People were, you know, saying, all right, this is you know, I was posting screenshots of like, no.

Peter Winick You were not you. So you were transparently testing the methodology to me.

Vuk Vuković Yeah. And people were gaining about gaining. So on one hand gaining a crowd of people that were participating in the, you know, in our methodology and the surveys that we’re using. On the other hand, also potential investors actually like half of our initial investors, half of the money, at least when we started the fund, came from people who saw us in the newsletter. And that’s right.

Peter Winick There’s a there for a minute. So not only were you doing this transparently, but then you’re putting your own money where your mouth was, right? People are watching because it’s one thing to have a theory, but it doesn’t get more applied than when you’re putting your own money up. And what I love about the conversation you and I had a couple of weeks ago was that was really attractive to investors, right? Because picking a political market is interesting and there is a business model there. But picking the direction of whatever, it’s the S&P or Nasdaq or whatever, there’s a lot more money in that can be made and a lot more at stake there.

Vuk Vuković So those are logical purposes to the letter. Absolutely. Yeah.

Peter Winick Exactly. Exactly. So you also mentioned and I want to go back a half a step wisdom of crowds. And I remember when I think James sure. Wiki came out with that book had to be almost one two years ago or.

Vuk Vuković Had somewhere here. Yeah.

Peter Winick Yeah. I the only two I’ve got, it’s sitting on like awesome. But the, the concept and maybe you could describe it better than I could of wisdom of crowd is that the crowd is always smarter than any individual in the crowd. Right. Is that kind of let me give us the definition of wisdom of crowds.

Vuk Vuković Yes. However, under certain conditions. Right. So that is true. So that’s kind of in a nutshell. Actually, even like 100 years before Stravinsky came up with that was a guy, Francis Galton from England. Right. A professor he was a chemist, I think a professor. And he was at this county fair where he was trying to, you know, where people were competing and trying to guess the weight of an ox. Right. And if you guess the accurate weight of an ox, you get to take that, which was a big deal back then, right? And so he was writing down everyone’s individual predictions, and he noticed that no single person was accurate individually. But as a group, when you average it out, they were incredibly close. Right. So, you know, like it was it was like 1 pound was the difference in weight. So he applied this later and there was a lot of bunch of papers doing the same, where you have a decentralized crowd where people are not influencing each other’s opinions. Right. So, you know. So for example, if I ask a crowd and one person says one opinion and then everyone else kind of goes with him, that’s not a, you know, that’s a bias problem, right? So you need to have a decent.

Peter Winick Or not influenced by the trend of the…

Vuk Vuković Influence, you know.

Peter Winick Like, so they’re making their, their predictions independent of

Vuk Vuković Independent. So that’s what I’m…Yeah. So independent uncorrelated predictions decentralized everything in an aggregation mechanism which is like a survey. You need those conditions. And then you can get the kind of the wisdom of crowds. But with us it was not just the wisdom of crowds. Right. So that was 1 to 1 part, right. If we just use wisdom of crowds for it, for the Trump election 2016, with Brexit, it would not have been enough, right? What really helped us because as we, as I mentioned, right. So sometimes the crowds can be very biased. If yes, they like one direction. So what we use in addition was a network analysis, right where we can figure out if some people are in kind of bubbles. Right. So you have like a conservative bubble in their liberal bubble. And then those people that are in those like echo chambers tend to have they tend to be worst predictors, which makes sense. Right. So you don’t have a good view of how, you know, the other group thinks if you’re only surrounded by likeminded individuals, I mean, we all up. We all are to a certain extent surrounded by likeminded individuals. But what you really want is heterogeneous groups, right. So let’s think of elections, right? Some of your friends or left wing, some of them are right wing, some of them are centrist. So you have a higher probability of getting it right. Right. As opposed to someone who is only surrounded with people who are a left wing or right wing views. That’s the idea. And when you apply that methodology, you kind of you get different weights for people and different levels of network, and that’s how you get a more accurate signal. At least this is what we found.

Peter Winick Got it. So your monetization strategy from a fall leadership standpoint is really the hedge fund, right. You’ve got this unique perspective. You’ve got this methodology. You’ve got these frameworks as a let’s call it a marketing launch for lack of a better term. You went transparent on this portfolio. People were intrigued. And then you said, okay, you know what? I need more money, right? I want to do this as a hedge fund. And the people that were following you became fans of the thought leadership. So it’s an interesting parallel with a different twist to what many people do. Right? You might have an aspiring manager that fire that follows someone who’s got great management content and they apply their ideas, they say, wow, they really work. Maybe I’ll bring them in or license their content, etc.. So what other things or ways are you thinking about using, prioritizing, getting your thought leadership out there to achieve your business objectives?

Vuk Vuković So I mean, as you mentioned, that was the main one. So but it was not the first one that came to mind. Right? Initially, once we did this, we went through elections, right. And market research. So that was kind of the obvious point because we were our flame was, you know, we can do it better than the polls, right? Yes, we did, you know, back in 2016 and in 2020, and we did the French elections. We got a bunch of stuff as well, which was always more accurate in the polls. But there wasn’t a lot of I mean, and disrupting that industry is really difficult because it’s typically linked to either, you know, party or whatever or certain the news media. It’s very hard to get into that. So that’s why we did a lot of market research projects. On the side is woodwork. But you know, with this methodology, I mean, it’s great with market research when you have like very polar opposite opinions, but it’s not good for like, you know, picking an optimal toothpaste or something. And the methodology doesn’t add value. It’s just like a regular survey, but it really adds value when you have like differing opinions. And that’s when I said, well, you know, we should do this in markets. But it took us a while to get there because we needed to get more clients and more money, you know, to fund this on our own. And that’s why it took a while, even though the idea was always there. But yeah, it took a while.

Peter Winick And if you’re enjoying this episode of Leveraging Thought Leadership, please make sure to subscribe. If you’d like to help spread the word about our podcast. Please leave a five-star review at ratethispodcast.com/ltl and share it with your friends. We’re available on Apple Podcasts and on all major listening apps, as well as at ThoughtLeadershipLeverage.com/podcast.

Peter Winick And so if you think about let’s just apply this to the S&P 500 index to make it simple. Right. So the S&P 500 index you’ve got your methodology. And the methodology is going to tell you it’s going to go up this week or down this week or whatever the case may be. And then you’re going to make some bets right. You’re going to make some trades or whatever based on that. At what point does things like regression to the mean and all that come into place, like, can you can you beat the market more than the average that the market will return? I guess is my question.

Vuk Vuković Yes. I mean, so we have thus far over four years of data where we’re doing this. Right. And we we’ve noticed that the methodology itself is, let’s say, accurate enough. It predicts the market correctly over 60% of the time. So it’s never been less than 60%. It’s never been over 70. So somewhere between 60 and 70%.

Peter Winick So if you can be right 60 to 70% of the time. Exactly. Okay. So you’re.

Vuk Vuković Doesn’t necessarily mean that we make money because we’re buying It’s 60% the time you buy maybe, maybe a little bit less. But it’s all about staying consistent, right? And that’s the point of that’s where the trading skill comes in. Right. So you can be accurate, you know as much as you want, but if you’re not being consistent and following a methodology, you’re probably not going to make a lot of money. That’s true for every trading out there. So you need to have you know that the system that works, the signal, it works. But you also need to have a consistent trading strategy. What we came up with was just do a very simple option strategy, right. We risk only 2% of the portfolio every week. So that’s a we so we take the 2% of the portfolio to buy options premiums meaning buying either calls let’s go up or puts markets go down. And if we’re right we make money, right. If we’re wrong, we lose only the 2%. Nothing. Not more than that. That’s the whole idea. So, you know, we’re going to lose money 40% of the time. But in those 60% of the time, we’re going to make much, much more and grow.

Peter Winick Got it. Got it. So people can understand that. Because even though there might be some complexity in the algorithms that you’re applying, the way that you just explained it is fairly simple, right? And you’re also not making an outlandish claim of, you know, we’re going to beat the market 99 times out of 100, right? Because that’s not like you just need to be a fair amount better than a coin toss, right?

Vuk Vuković Yeah, exactly. And that’s the point. I don’t know if you heard that there was a speech by Roger Federer that has a great thought leadership piece, right? Where he said, like it was like a Duke University or something. He said, you know, I want 80% of all my matches, but I only won 54% of all my points throughout my career. 54%. Right. It’s like just a little bit over coin toss. But that’s the point. At least he knows, like when you’re in the zone, when you’re in the game, you know, if you lose a point doesn’t matter. You go on to the next one. And that’s how you have to think of this, right? So every week for us is a new thing. Every week is whatever happened the week before doesn’t matter. Every week we start over and I need to be in the market every single week because I don’t know which week is going to be a good one, which one is going to be a bad one, right? If I knew that before.

Peter Winick Also, going into a different channel of thought leadership, when you talk about something like Black Swan, right. If you missed a week, that could be you know, if and I guess in your case the down week your Dow side is capped at 2%. But an up we could be walking up 20% or something. There’s something really extreme.

Vuk Vuković Or vice versa. So if it’s a so if we’re short the market and there’s a black swan event that sends anything, everything down that you can make, you know, ten, 15% a week. Yeah. Happened.

Peter Winick Interesting. What other ways are you going to continue to get the leadership out there to attract investors and such? Any other because you’ve gotten in in a certain way right where they’re following your trends, speaking, writing, like what are the formats and modalities you’re thinking to use to put the thought leadership in, to amplify the message that it’s got?

Vuk Vuković So great question. I mean, and various things. And I’m typically the way that we develop this was from my own outreach on LinkedIn and Twitter. Right. So I have yeah, I do a lot of things that are trying to explain concepts in economics or involves politics? Political economics, kind of my background. One thing that I’m using to that extent is my book that recently came out, was published by Oxford University Press. Now, this has nothing to do with the fund. It’s my it was my PhD thesis from Oxford where the thesis was, I was looking at the collusion between politics and the corporate world and how it affects top income inequality. Right. And I wrote a whole book around it, some history, some kind of, you know, a unified theory. And it came out and yeah, it’s called Elite Networks The Political Economy of Inequality. It’s available on Amazon, Barnes and Noble, etc.. And this is kind of been something that I’m, you know, I’m pushing forward into, you know, presenting myself out there as, as an author, as someone who, you know, knows stuff about, you know, and omics and, and politics etc. and happens to have a fun laying around based on so. So the network theory is underlying the underlying mechanism behind both. Right. So I’m using network theory to explain the collusion between elites on the top level of society. And I’m all for using networks to try to understand in social media bubbles.

Peter Winick So I want to go back to sort of the beginning of that story where you said you’ve got the book out and it’s based on your PhD thesis. Now, I would argue that you didn’t just take your thesis handed over to a publisher and say, publish that as a book. How do you change the not the not the methodology, but let’s say the language, you know, because most with all due respect, most PhD thesis is are unreadable to the average.

Vuk Vuković Human in the book. I agree.

Peter Winick Yeah. How do you move that? It’s almost a translation issue. How do you move it to a book? So it’s it is a readable. It’s a it’s I want to spend 6 or 8 hours with.

Vuk Vuković Right. Exactly. I mean so it’s not easy. Obviously you have to kind of people like to say dumbed down. I don’t like to use that word. I like promoting it to a general audience. Right. So talking about things. That’s why I introduced a lot of history, a lot of storytelling. Right? Yeah. Because on one hand, because I know my findings, I know my research. It’s not, you know, I don’t have to talk about the methodology, the research, but I can talk about stories that explain what the research is about. Right. So I can talk about things like, so how does this work mechanism work in different countries? How hard worked in the US during the 19th century doing Tammany Hall in New York, right. How it worked in countries like, you know, Tunisia or Indonesia or whatever. Right. Russia. Venezuela.

Peter Winick So the connection of the storytelling is telling. So, so if I were to sort of simplify what you said in a thesis, the data is king, right? The data has the has to stand up and the storytelling probably.

Vuk Vuković Is secondary, not.

Peter Winick Secondary if not tertiary. Right? Doesn’t even matter when you’re going to put a book in general format. The storytelling has to rise to the top, and it has to use the data and connect the dots there, because most people need the, you know, humans need stories to bring something to life. Numbers don’t typically do it. So. Exactly.

Vuk Vuković That’s absolutely the idea. And then if you throw in a little bit of history, a little bit of got famous examples. So I talk about Sam Bankman-Fried and Elizabeth Holmes, those kind of things. Right. Yeah. Yeah. Yes or collusion I mean and that makes it interesting. Right. That makes the whole the whole theory applicable. Right. And I’m finally again so, so someone could say but this is not you know, these are just anecdotes. Of course they’re anecdotes. Right. But I’m you know, there’s a theory behind it and I’m using the anecdotes, anecdotes to make the story more appealing, to make it more attractive so that people can understand what I’m talking about.

Peter Winick Well, this has been great book. I appreciate your time and best of luck. Thank you.

Vuk Vuković Absolutely.

Peter Winick To learn more about Thought Leadership Leverage, please visit our website at ThoughtLeadershipLeverage.com. To reach me directly. Feel free to email me at Peter at ThoughtLeadershipLeverage.com. And please subscribe to Leveraging Thought Leadership on iTunes or your favorite podcast app to get your weekly episode automatically.