Twitter: Social Media Network as a Money Making Machine
New York based Josh Brown,vice president of investments at Fusion Analytics, uses Twitter and StockTwits to boost his trading profits, Reuters reported. He is not the first, nor the last, the news agency informed, and the trend may continue to grow.
In fact, we predicted the power of news media and social media as influencers in trades a long time ago, when we reviewed SENSEnews, a handy online service that can predict how online news and social media content affect stock prices. In this light, the move by many money managers to mine social media for content relevant to their trade portfolios makes sense.
Twitter is a free tool, and a very powerful one for that matter. While most users are on for entertainment, businesses are using the network more and more to advertise and sell. Advertising and selling in the new age of communications have changed their ways. Now the whole process is hidden behind terms like “community engagement” where skilled marketers give a false impression that they actually give a damn on their customers, that they listen. In fact, this “engagement” is converting customers in PR tools – or “brand ambassadors.” You all know the mommy bloggers endorsing products for freebies. Well the issue goes deeper: mommy bloggers are just the tip of the iceberg.
You cannot really see what lies beneath. You have to be a skilled trader to understand the subtleties of the game. Josh Brown and his contemporaries understand the power of social media to make money better than anyone else – and we are not talking pennies.
But as the Reuters report quoted above underlines, there’s also a matter of compliance we should consider: “How regulators decide to classify the faster, trendy way to communicate — and who’s responsible for monitoring it — will determine just how long Wall Street can shun the new technology.”