Social media has created a guide for how modern online users wish to receive news and information. We not only demand that the information we consume is fed to us in an interactive, visually-appealing, and mobile-friendly fashion, but we also want that information to be personalized and relevant to our particular interests.
Applications like Twitter and Instagram curate content that is geared for individual users and does it in real-time. There’s no doubt about it, instantaneous personalized information has become the standard for social media and news platforms. Now, wouldn’t it be nice if financial apps could deliver news and research in a similar manner?
Well, that’s exactly what StockTwits has set out to accomplish.
StockTwits is a FinTech company designed with an interface experience that is eerily similar to Twitter’s. The main difference? StockTwits is all about investing! That means the conversations focus on financial news, research, and what’s happening in the markets.
Sound interesting? Let’s review the basic features of StockTwits platform so you can decide if it’s worth your time.
What is StockTwits?
StockTwits was launched in 2008 by Howard Lindzon and Soren Macbeth. The founders’ primary mission was to develop an interactive financial forum for investors. They accomplished their mission by successfully giving users the tools to initiate conversations about the stock market, investing strategies, and personal finance on a well-designed social platform.
The founders have developed an online environment that gives life to financial ideas from around the world, giving users the opportunity to present concepts for feedback, collaboration and debate. StockTwits’ 1.3-million-member platform produces over 4 million unique messages a month. In addition to the social component, StockTwits has become a popular research tool among younger investors. Many turn to StockTwits as a resource to supplement the data and investing opinions they’ve gathered from other stock trading apps, message boards, and publications.
Who is StockTwits for?
Although StockTwits supplies information that any age group can benefit from, the platform’s undeniable resemblance to Twitter strongly suggests that it’s geared toward millennials and members of younger generations. Regardless, I’d recommend StockTwits to any investor who falls into one of the following categories:
- Investors who like to conduct preliminary research on-the-go
- Investors who want a platform to share and discuss their investing ideas with others
- Investors who are currently using Robinhood or other commission-free stock trading apps such as Webull
- Investors with a strong interest in picking individual stocks
How Does StockTwits Make Money?
Presumably, StockTwits’ primary source of revenue comes from the steady stream of advertisements appearing on the app and website. While the ads don’t necessarily dominate the virtual real estate, they can become a distraction at times. Fortunately, StockTwits is completely free which helps offset the advertising eyesores.
The StockTwits Interface
Like I mentioned earlier, StockTwits is essentially a stock market message board with a Twitter layout. Traders create posts with charts, links to articles, and market opinions about various stocks. These ideas are organized into streams for each individual stock. When a StockTwits member generates a post about a public company, they can use what’s referred to as a “cashtag” to tag the post.
For instance, let’s pretend that The Dollar Build is a publicly traded company and that our stock symbol is TDB. If you posted a message about our annual 10-K report and tagged the message with the cashtag $TDB, your message would appear in the main feed for The Dollar Build. Now, any user following TDB would have easy access to the 10-K report.
You can neatly organize the companies you follow in StockTwits by adding them to your watchlist. Simply search for the ticker symbol of the company of interest and click add. Keeping companies on your watchlist makes it easy to access a slew of information about those companies in an instant.
In addition to unique posts, each company’s stream features information about their current stock price, public sentiment, and how frequently the stock comes up in message board conversations. Finally, you can find articles from firms like Forbes, MarketWatch and other sites around the web toward the bottom of the page.
StockTwits Finest Features
If you’ve ever used Twitter before, the StockTwits platform will feel very familiar. Despite that familiarity, StockTwits has developed some innovative features of its own. Let’s dive into some of the more popular features so you can see what’s available to users.
StockTwits provides real-time message streams that can be organized by specific cashtag or by general themes. For example, you can organize message streams by:
- People. Select the individual users you want to hear from and monitor their insights.
- Your Watchlist. Follow the discussion surrounding the companies on your watchlist.
- Suggested. Get recommend content, news and information about the companies and market sectors you’re most interested in.
- Trending. Stay up-to-date with the most talked about topics on StockTwits.
- Charts. Keep track of posts containing charts, graphs, and other visuals.
Message streams contain diverse information from a variety of users. For instance, some posts come from users who fancy themselves as expert stock traders. Others come from online trolls.
For example, one user stated that he would smash his face into cake if a particular stock didn’t go up at least 10% the next quarter. The stock ended up going down 5% and a cake-smashing post ensued. While this was fairly entertaining, it also serves as an example of the less-than-useful information you’ll often encounter on the message boards. But to be fair, I have found and followed a number of users who continuously put out valuable content pertaining to the sectors I care about.
Heat Maps and Data
One of the most valuable features of the site – and what sets StockTwits apart from Twitter – is the Heat Maps section. While twitter allows users to organize messages by specific stocks or cashtags, StockTwits aggregates data for those stocks and creates visual representations of that data in the form of Heat Maps.
StockTwits also has a section that identifies top stocks that are trending based on increased (or decreased) levels on social activity.
Stocktwits divides their financial chat rooms into three categories: Featured, Popular, and Premium. Most of the chat rooms under the Featured or Popular tabs are completely free. The different groups act as a tool to surround you with other investors with similar interests and/or investing styles. If you’re a day-trader, then you might want to participate in the day-trading chat rooms. If you prefer buy-and-hold investing, then you may prefer to discuss your strategies in a room with other long-term investors.
If you’re looking for chat rooms with members who have greater investing credibility, you might consider joining a Premium room. Premium chat rooms are run by financial professionals whose credentials have been validated by the StockTwits team.
StockTwits has partnered with Robinhood to create a cross-platform user experience. This functionality allows users to seamlessly move between researching stocks on StockTwits and trading on Robinhood. This function is easy to set up and easy to use. On any stock profile in StockTwits you’ll find an option to “trade.” By following this link, you’ll go straight to the purchasing screen on Robinhood where you can specify how many shares you wish to buy or sell.
Handy Investment Research Tool. StockTwits is a well-organized platform that aggregates stock information making it easy to use for investing research.
- Easy-to-Use Interface. The platform’s resemblance to Twitter makes it familiar for most users and easy to use.
- Interactive and Entertaining. The platform is great for generating investment ideas and conducting preliminary research.
Streams Can be Noisy. Lots of the information you’ll find on the streams is non-informative.
- Credibility Issues. It’s difficult to assess the credibility of other StockTwits users, which makes it difficult to know who’s worth listening to and who should be tuned out.
- Advertisements. Like any other platform, advertisements can interfere with the user experience and become an annoyance.
Is StockTwits Worth Your Time?
StockTwits has built the framework for a unique financial research experience. The platform delivers significant value to users who want a place to discuss their investing ideas. On top of that, the organized message streams and aggregated data provide helpful insight into specific companies and overall market activity.
In my view, the greatest challenge facing StockTwits is the high volume of unintelligible information that often clogs up message streams. An overload of unqualified opinions and noise can make it difficult to carry on constructive conversations, which is a significant threat to a positive user experience. Until StockTwits finds a way to obscure or filter out useless content, the app won’t reach its fullest potential.
As it stands, StockTwits is still incredibly useful. It provides a blend of research and social features that put the platform in a class of its own. So, despite my qualms with certain elements of the platform, I still think individuals looking for real-time stock news, information, and conversation can find value in StockTwits’ free platform.