How Social Media Can Influence Markets

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March 24 (Bloomberg) -- Seeking Alpha President David Siegel discusses crowdsourced stock opinions on Bloomberg Television's “In The Loop.” (Source: Bloomberg)


Seeking alpha is the largest crowd source platform that exclusively focuses on sharing top investing ideas.

We have a group of about 85 hundred contributors around the country that publish content, and we have about 10 million people as registered users who read our content as well.

This studies coming out saying that the blogosphere and social networking is more act here at -- accurate in predicting the direction of the market and wall street community.

The notion that crowd source content is more influential has been proven in lots of studies.

More round restaurant reviews, movies, or other types of content.

For the first time, the analysis is coming out that demonstrates that the same holds true when it comes to stock market movements.

As much as there is a chinese wall in our banks, we sometimes wonder if there are other factors that might be influencing a particular analyst.

In the blog is here, i would imagine that there is less of that, people have their individual positions at play, but in aggregate if you're taking everything overall, do you somehow perhaps even out the extremities to get one consensus that is more accuratee?

That is exactly correct.

There are two values they provide over regular research.

The first is the real-time nature.

I national markets, more than any other market out there are more conducive to real-time than anywhere else.

Social media is all about engagement.

Discussion, disagreement, would you have that, and you have that context it is something that traditional analyst cannot do.

Very different.

Here's my target on the s&p, here's my price target on ebay, and in this case is a back-and-forth and commentary.

What does it mean for the future of wall street research?

We know it has been under a salt for a variety of reasons for a while.

Wall street research has certain elements that are highly beneficial that the crowd cannot necessarily provide.

It is important to understand that as well.

For example, deep i national titles as one.

Access to company executives is another.

At the same time they are going to be able to provide the same level of real-time feedback, the same time of -- type of rigorous debate and discussion.

They looked at seven years worth of data, they look at 500,000, the cost i've hundred thousand articles.

They conclusively proved that the whim of the crowd beats the experts.

It is pretty incredible.

How do you make money on this?

How do you monetize this?

We have seen the banks, they charge for their reports.

How does a business like seeking alpha effectively do the same?

If you do a great site and a great platform where there is exchange idea, then viewers know that.

There's always the opportunity for monetization.

We're trying to build the best possible site we can with as rigorous and editorial review of the content as well as an open forum for comments.

As long as you have a legal get monetization.

Some of the bloggers are anonymous.

Yet we know who they are.

David einhorn has expressed his concern.

He would like to know the name of the seat he flow blogger who revealed one of his investments.

It wasn't? where not we did tell you right now.

Why hide behind anonymity?

Why not put your name on something?

We vehemently believe that it is critical to have an open platform where everyone can discuss and debate without necessarily having any repercussions to that.

With that said, we have what he said -- we have 24/7 monitoring on everything review.

97% of the content as provided on our site is also rejected as first time content.

It is very important to us to create the first four of -- the right forum.

Call me old-fashioned, but part of journalism was when you wrote an article you put your name on it.

He did not hide behind anonymity.

Why allow your bloggers to do that?

It is part of our philosophy.

We do have an open environment and flexible environment to how people to comfortable posting what they need to.

We have a very rigorous background check.

Was you would understand why david einhorn would be upset to read actually want to know who this person is.

This text has been automatically generated. It may not be 100% accurate.


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