As more of the world’s business can be conducted online, millennials remain the most connected generation alive. Social media provides an active pulse for what’s happening in news, sports, entertainment, so why wouldn’t the same concept be true for investing? There are plenty of apps that feature robo-advisors to help young people make better investment decisions, but none of them operate as a social network for investors. StockTwits is the only service of its kind that features a focus on investing and teaching its increasingly younger audience the best practices for managing money.
What is StockTwits?
StockTwits started as an off-shoot of Twitter, implementing the dollar symbol ($) before stocks to include stock data in tweets. Since then, the service has morphed into its own platform that is no longer reliant on Twitter but operates much the same way. Users can sign up and create a profile to begin sharing their investing ideas. There’s a lot of chaff to wade through as plenty of people are pushing products and services on StockTwits, but plenty of legitimate day traders, swing traders, and hedge fund managers maintain active accounts for sharing their trading ideas.
How is StockTwits Used?
Users can create a stream of their own stock trading ideas to share with the community, tagging the relevant stocks so their information will show up on that stock’s feed. Most investors use the service to keep their ear to the ground for hot stock tips from major investors that tend to follow the same strategies. For example, hedge fund managers that love the day trading scene will be followed by both day and swing traders who are looking to make some cash from following a ‘celebrity’ investor’s plays. Investors who have confirmed their identity at a company are marked with a verified badge, much the same way Twitter verifies personal accounts.
Is it Valuable?
This question is pretty subjective, but the short answer seems to be yes. A recent interview with the StockTwits CEO revealed that the site’s most active users (52%) are young people between the ages of 18 and 34. These people are most likely to be investors in consumer stock companies like Snap, Apple, Etsy, and cryptocurrencies like Bitcoin. That interview revealed that only 20% of StockTwits’ users are age 45 or older, so it definitely trends toward the younger crowd.
Does it Help with Technical Analysis?
Remember that part where I mentioned people share all their wild ideas? There’s a lot of chaff there to pick through. Rosen himself admits that users share around 10,000 annotated charts a day. Some people share charts to support their opinion or oppose someone else’s, so there’s a lot of spirited debate about stock performance. Professional investors do keep an eye on the platform, but StockTwits should be viewed as more of a zeitgeist for the public opinion of a company rather than a true trading resource. Millennials are using it to discuss the performance of their favorite companies, even if they have no investment stake.
