Do You Use Social Media in Day Trading?
We’re all inundated with huge amounts of data on a daily basis that includes email, television news, conversations, texting, and now a growing number of social media outlets. The problem most people have is extracting and filtering of these volumes of data into useful information. Social media has taken on a life of its own in connecting with companies, family, friends, and individuals you would prefer to have no contact with at all.
A great deal of information can be obtained and shared through social media although much of it may prove to be of marginal value or even contradictory. On the plus side you’re enabled to follow the opinions of expert analysts for selected markets in a real-time environment. This enables you to evaluate opportunities that may otherwise have escaped your attention entirely. On the other hand are those that present their cynical viewpoints that may scare you away from profitable ventures (even intentionally).
Be aware that posts on such sites as Facebook, Twitter, LinkedIn, and public blogs function more as opinion than fact. They are nonetheless useful to a day trader that has developed an investment strategy recognizing those attributes. Over time you can determine which posts are reliable vs. those that lead you astray and could even result in disastrous losses.
Social media outlets for investors have today grown far beyond simple public posts and Twitter followers. There are now a growing number of day traders who post their experiences and suggestions on broker web sites and other niche sites that actually encourage input from traders including stock information. Online brokers have experienced an increase in trading activity from those traders who regularly make posts on their company portals. This increased trading activity is also true of visitors to the portal that don’t actually post. Such statistics substantiate the value traders place on the interaction with social media content toward their own personal investments.
Use of social media is growing consistently with one social network focused on investing experiencing a 70% increase in posts by their registered users in 2014. Participants in social media stock investment sites have shared not only guidance toward particular investments and potential for gains, but also tend to share research and charts that may support their observations.
Use Caution When Basing Day Trades on Social Media Content
Remember that social media combines useful experience and commentary with a mix of personal bias and even some intentional misdirection. Practice your own due diligence before just jumping into investments based on a casual comment on a site such as Facebook or Twitter.
Regulatory agencies oversee investment firms and even small financial advisers. The same is not true of unregistered traders providing advice on social media. That lack of oversight should be of concern to the average day trader, warranting the use of caution in following advice that may or may not be that of an educated, experienced investor or advisor.
Over time you can gain a level of perception for the opinions of individuals that you see on a regular basis. This will help you determine who provides reliable guidance and those who may be placing your finances in a precarious position. Once you find a contact on social media who appears to be doing a great job of steering you in the right direction, it’s beneficial to the resource to pass along their information to other potential ‘clients’ that can benefit from the knowledge, such as retweeting a post that did well for your trades.
Day Trading and Social Media – A Natural Combination
Online brokers are a natural fit for combining the use of social media with day trading. Traders are already online monitoring contacts for trade activities and exhibiting constant interaction with such sites. This makes it easy to switch to an online broker site for executing buy and sell activities armed with that knowledge and strategy.
SureTrader is a leading online broker with tools and news sources for accurate analysis and lightning-fast trade execution. SureTrader provides friendly and courteous support available to our clients on a 24×7 basis to answer any questions and resolve problems.
SureTrader’s desktop and mobile applications ensure timely and flexible access to SureTrader services – iOS and Android platforms are each supported. Global access to services enables quick and easy trades even in after-hours trading.
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Disclaimer: SureTrader Blog is not intended for U.S. persons. Stock information is not to be viewed as buy or sell recommendations.