Why Google Trends is one of the best investing tools
Google Trends is a key tool for stock market investors and traders, providing unique insights into global Google search trends. The data, sourced directly from Google's database, is highly reliable and offers real-time, unique insights into consumer behavior, often reflecting the collective subconscious before it impacts the market.
(If you aren't familiar with Google Trends, get up-to-speed before jumping into this guide.)
Advantages of Google Trends for investing
There are many advantages to using this unique data set for investing, including but not limited to:
Real-Time Data: It provides up-to-the-minute data, allowing traders to react quickly to emerging trends before they fully manifest in the markets.
The Most Honest Data: Data from Google Trends captures genuine user interests and concerns that are not typically shared in surveys or other research. Many consumers say they’re more honest with Google search than with their own spouse. This is especially relevant in investing where people may, for example, share fears about their financial situation that they’re not sharing with others.
Plenty of Historical Analysis: Access to over two decades of data allows for comprehensive backtesting and long-term trend analysis.
Customizable Queries: Investors can find signal based on their own research and curiosity, not on select terms that are pre-curated, as is often the case with other trend analysis tools.
Unrestricted Queries: While Google Ads prohibits certain subjects like cryptocurrencies, alcohol, and medicine, Trends provides unrestricted access to all keywords. Unfortunately, many trend analysis tools only rely on Google’s Adwords API to gather search data, therefore providing limited insights.
Massive Scale of Data: Google processes trillions of searches annually, making the dataset extremely large and diverse. This also means there’s less bias towards a single demographic, so a given analysis is far less likely to be skewed.
Industry-level insights: We'll begin with exploring how Google Trends can provide unique insights into entire industries, then move on to specific companies and products.
Spot mispricings
Search data can be used to detect mispricings by comparing stock prices to interest levels.
For example, imagine it’s mid-May, 2020, and the entire travel industry has been decimated by COVID. Airline and hospitality stocks have plummeted as nobody can foresee demand returning anytime soon.
And yet, if we perform some Google Trends analysis, we can see there’s some mispricing amiss. Here’s the price history of top airline stocks (blue) vs. Google searches for flights (orange):
For 3 weeks, from the end of April through mid May, airline stocks continue to fall while flight interest steadily increases.
Seeing this, we decide that the market is bound to reprice airlines to match the recovery in demand for flights, and we purchase shares just in time to catch the 100%+ spike a week later:
Try it yourself: Compare industry stock prices against high-intent search trends to spot mispricing opportunities.
Measure and track cultural shifts
If an industry’s success relies on a cultural shift, we can use Google Trends to track the status of that shift to inform whether or not we want exposure.
For example, if we’re looking at investing in meat alternatives, we can view the trend data for queries like “is meat healthy” to gain insight into whether consumers are becoming more or less curious about their meat consumption.
In this case, we see a consistent rise in searches, indicating that meat alternatives will likely benefit from the increased concern for meat’s health-related side effects.
Learn more about tracking terms' interest over time.
Try it yourself: Explore the status of a cultural shift by searching keywords that represent interest in it.
Spot micro trends to get ahead of macro shifts
All cultural (macro) shifts originate from the clustering of specific (micro) trends. As an investor, if we can spot the micro trends, we’ll have insight into which macro shifts might emerge and therefore spot other opportunities.
For example, imagine it’s 2012. People are starting to hear about Uber, yet the greater macro trend of the “sharing economy” is still a term used only by a handful of people.
If we hear about Uber through a bunch of news articles about the rise of a new “sharing economy”, we are already too late.
Instead, if we spot the rise of Uber early, we might foresee other companies capitalizing on the growing sharing economy. For example, Doordash, which took off shortly after.
While Google Trends is useful in researching these companies after we hear about them, it does not recommend which companies to investigate in the first place.
Glimpse, an extension that enhances Google Trends, solves this by tracking every significant keyword searched online and alerting you when a term like Uber starts to take off in popularity. This means we can systematically spot new trends right when they emerge and act before anyone else.
For example, Glimpse spotted and published content about the rise of pickleball in 2019, before it grew more than 800% in popularity. Had we known about this trend then, we could have made investments in retailers like Dick’s Sporting Goods (up 400% since 2019) to capitalize on the growing interest before it became the cultural phenomenon it is today.
While the focus of this guide is on Google Trends, we’ll reference Glimpse where relevant to highlight additional insights.
Try it yourself: Sign up for a free Glimpse account to start spotting micro trends and get ahead of the curve.
Asset-level insights: In addition to insights at an industry level, Google Trends can provide unique data on specific assets, companies, products, and more.
Measure and track consumer sentiment
Search data offers invaluable insight into consumer sentiment towards a brand, which can inform our decision about whether or not to invest.
Suppose we’re considering investing in United Airlines. Beyond our financial analysis, we want to understand how consumers perceive the company. Google Trends can help by revealing queries that indicate skepticism.
To find relevant queries, simply type ‘is United Airlines’ into Google and review the auto-suggestions.
The top two suggested queries reflect consumer skepticism. Searching them on Google Trends, we see both have shown increased search interest over the past few years:
The growth in these terms suggests that certain events may have damaged the public’s perception of United Airlines, something that might not be otherwise apparent in a financial analysis.
The Glimpse extension streamlines this process with a People Also Search panel, which compiles and categorizes the most common questions related to any search term, sorted by search volume.
However, before drawing any conclusions on United Airlines, it’s worth investigating whether this skepticism is unique to the company or represents a broader issue within the airline industry.
To find out, we can remove ‘United’ from our search.
It appears the airline industry as a whole is grappling with growing consumer skepticism around safety and quality.
We can apply this analysis to any company or industry by adjusting the suffixes to fit the context. For example:
Transportation: “safe”, “reliable”
Tech: “private”, “safe for kids”
Food: “healthy”, “unhealthy”, “good for you”
Banking: “trustworthy”, “good”, “FDIC insured”
Try it yourself: Measure trajectories of the top concerns for your chosen company to determine if they are increasing or decreasing.
Use seasonality to understand consumer behavior
While it’s obvious why demand for Christmas trees peaks in December, many other topics follow less-obvious seasonal trends.
For instance, interest in ‘Google Docs’ fluctuates throughout the year. See if you can spot the pattern in the graph below:
Notice the spikes in spring/fall and dips in summer/winter, which suggests that education and the school calendar are major drivers of interest. This can inform how we view Google Docs’ future prospects and better time any related investment decisions.
While it’s possible to identify this pattern just by looking at the Google Trends trajectory, it’s not easy, and since seasonality is crucial for understanding a product or service, Glimpse includes a dedicated panel that provides a simple visualization of seasonality, along with an explanation for what drives it.
Additionally, because seasonal variations can make it difficult to identify the overall trajectory, Glimpse adds a seasonally-adjusted trendline, growth calculation, and 12-month forecast.
While the tool’s forecast accuracy is over 87%, deviations are certainly possible. Nonetheless, we can be reasonably confident that, barring any major events, search activity in Google Docs will continue to decline over the next year. This doesn’t always mean that usage of Google Docs will decline but it does offer a unique view into public interest in the product.
Try it yourself: Search a variety of company-specific keywords and determine their seasonality to better understand the consumer behavior that drives demand.
Measure hype to avoid poor market timing
While investments in established companies often rely on financial analysis, some asset classes—like crypto, NFTs, penny stocks, and high-growth tech stocks—are driven largely by speculation. This speculation economy has surged, fueled by finance influencers who can rally millions toward particular assets.
If we choose to invest in speculative assets, it’s crucial to gauge search interest as an indicator of market hype. Predicting exact peaks and troughs may be difficult, but by avoiding entry when interest is at its peak, we reduce the risk of buying during a frenzy. Instead, entering when prices are stable and search interest is low may help avoid the rush.
For instance, in December 2020 (red), Bitcoin hit new highs, along with search interest for ‘buy bitcoin,’ suggesting a FOMO-driven surge. This crowd of new investors may be more likely to sell if prices dropped, amplifying a crash.
Alternatively, consider February 2023 (green): Bitcoin’s price begins to rise steadily, yet search interest remains low, suggesting that existing holders, not speculators, are adding to their portfolios. When interest eventually spikes, prices surge.
Buying before the spikes in interest helps us ride the gains with reduced risk from panic selling.
Try it yourself: Check the current search interest in your target asset the next time you’re considering an entry to measure hype and avoid poor market timing.
Measure shifts in market share
In performing a competitive analysis of a particular market, we can track search interest for various companies to measure shifts in market share.
For instance, Grubhub initially led the food delivery space but was later surpassed by Uber Eats and then DoorDash, as Grubhub steadily declined.
Additionally, building on the consumer sentiment analysis covered earlier, we can compare how different products or companies address common concerns, such as privacy across web browsers:
Learn more about comparing terms in Google Trends.
Try it yourself: Compare search interest in competitors, either at the company or product level, to track shifts in market share.
Gauge the impact of PR
Lastly, we can gauge the impact of various forms of PR.
For instance, we can compare the popularity of Tesla events over time, gauging the degree of publicity the company is able to garner.
In this case, we observe that the peak to-date occurred in November 2017 when the company revealed its semi-truck and 2nd-generation roadster, with subsequent events only reaching a maximum of 75% of this interest.
Next, we can measure the success of a product launch by tracking interest over time.
For instance, the Tesla Cybertruck was announced in 2020, then launched in 2024. If we search Google Trends, we see that the announcement generated the most interest, with the launch reaching roughly a third of that peak. In the US, interest reached half its all-time high in mid-2024, but has since fallen off.
Lastly, we can measure the impact of bad press.
In Tesla’s case, despite continual growth, there have been recurring headlines covering crashes involving a Tesla, especially regarding its self-driving capabilities.
For over a decade, Google searches for “is Tesla safe” followed the trend of interest in the company as a whole. However, this has now shifted, and there is growing concern for the cars’ safety without a growth of interest in the company itself:
This could imply increased hesitation or apprehension about purchasing Tesla vehicles, affecting future sales and market confidence.
Try it yourself: Search for a company’s PR events to gauge their ability to capture attention, as well as any related searches that represent consumer perceptions.
In so many ways, Google Trends data offers stock market investors and traders an unparalleled opportunity to find alpha by pulling insights on entire industries, companies, assets, products, and more.