![]() ![]() This question originally appeared on Quora - the place to gain and share knowledge, empowering people to learn from others and better understand the world. Just so you know, over the last 30 years I have personally subscribed to 60+ investment and stock newsletters, various software screeners, and tested a variety of charting tools. Peer Pressure: Social Interaction and the Disposition Effect How do you know which newsletters CONSISTENTLY provide the best stock recommendations Keep reading and I will tell you. Wp 1522 facebook finance social interaction investing Quoras latest post-money valuation is from May 2019. Thats over 7 years and over 160 stock picks. We have been tracking ALL of the Motley Fool stock picks since January 2016. Quoras valuation in April 2017 was 1,800M. BEST STOCK NEWSLETTER The Motley Fool Stock Advisor has won our Award for the Best Stock Newsletter for the last 7 years. Understanding these “social transmission biases” will grow in importance. Quoras latest funding round was a Series D - II for 60M on May 17, 2019. The natural human tendency to follow the crowd and learn from others' successes, amplified through online networks, may be shifting the culture in finance toward greater short-term thinking.Īs financial markets become increasingly globally connected by technology, continued research on social influences could help shed light on how interactions shape decision-making and ultimately, market outcomes. Taken together, these results suggest that social media enables the selective sharing of investment "success stories" which can propagate more risky, active trading strategies even if most traders ultimately underperform. As a consequence, our research finds that social media amplifies the behavioral bias known as the disposition effect whereby traders sell winning assets too quickly and hold their losses too long. Its usually best to stick with ones that people in the industry are talking about for example TD America Trade, Robinhood &. Naturally, traders like to present themselves as winners because of the social stigma associated with losing. The Motley Fool offers several stock-picking services, but Stock Advisor is the company’s most popular. Traders on social media platforms are also likely to seek confirmatory information, for example, other traders who share bullish views on a stock.ģ) Traders, just like most other people, engage in impression management strategies on social media: While traders like to talk about their investment successes, they also disappear when their trading goes poorly. In other words, traders preferred to spread the word about their wins rather than their losses. 2) Broadcast gains, hid losses: Traders were more likely to privately message other traders on the platform following weeks when their own portfolio had high returns. ![]()
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