Gen Z was “awakened” to investing amid the meme-stock mania this year, and now they’re turning to social media for advice.
A new report from Fidelity showed more than half of Gen Z-aged people surveyed made a trade in the first three months of 2021 when the meme-stock craze took hold, with GameStop leading the way. Now, the generation of young adults aged 18-24 is wanting to educate themselves, and they’re turning to social media sites like TikTok and Instagram for help.
About 41% of Gen-Z investors use social media to educate themselves on investing, the survey showed. That’s more than their older counterparts, with 38% of Millennials and 25% of Generation X using the platforms for advice.
Kelly Lannan, Fidelity’s vice president of young investors, said social media is the most likely place Gen-Z investors turn to first when seeking advice. After that, they most likely seek advice from people close to them before going to financial services platforms.
“Good or bad people are still turning to social media,” Lannan told Insider in an interview.
Whether it’s TikTok, YouTube, or Instagram, “We want to be there, so we can make sure that we are doing our part in ensuring that Gen Z is getting the right information, and they’re not just listening to someone who wants to be famous on these platforms,” she said.
Nearly half of Gen Zs surveyed said they’re feeling more educated to motivate themselves on trading and investing. “That’s a really good thing if people are starting to ask questions and engage more with their finances,” Lannan said.
For young investors, stocks are the most popular, with growth and dividend stocks being the most popular, and meme stocks closer to the bottom of the pool, according to a recent survey from the Motley Fool.
Even so, many Gen Zs started learning more about the stock market when an army of retail traders mobilized on Reddit’s Wall Street Bets poured into GameStop along with other so-called meme stocks to drive a short squeeze. About 58% of the young group said it was “more excited” to learn about the stock market following the meme-stock market volatility, the survey showed.
YouTube is banning advertisements about a handful of topics from its highly visible masthead ad unit.
Political and election ads will no longer be accepted for placement in that unit, which is a banner running across the top of the video platform’s homepage. The covetable – and pricey – spot is “the most prominent Google advertising placement available to advertisers,” the company said.
Ads relating to alcohol sales, gambling – such as sports betting and casino games – and prescription drugs will also be banned, per the spokesperson. Axios first reported the change.
“We regularly review our advertising requirements to ensure they balance the needs of both advertisers and users,” a spokesperson for Google, which owns YouTube, told Insider. “Today, we are updating those requirements to limit the categories of ads that are eligible to run on YouTube masthead inventory. We believe this update will build on changes we made last year to the masthead reservation process and will lead to a better experience for users.”
Google, and other tech platforms, have faced scrutiny over their political advertising business in recent years, especially in regard to the 2020 presidential election and other events. The company blocked all political ads after the January 6 Capitol insurrection as a precaution to prevent any incitement of violence. The company maintained the ban until the day after President Joe Biden’s inauguration.
The investing side of TikTok, better known as “StockTok”, is ballooning, with the TikTok hashtag “#investing” garnering over 2.8 billion views. Many videos with tagged with #investing are centered around investing tips, and novice traders on the app have said they often heed the advice.
Thirty-six-year-old Douglas Boneparth, who provides investing advice to Millennials through his firm Bone Fide Wealth, said he loves the greater attention given to the world of investing through social media. But with the democratization of the stock market comes a lot of misinformation and “cringe.”
“It can get loud and noisy, and if you follow the wrong thing you can make some mistakes you really regret,” he said.
Insider asked three market experts for their take on nine popular TikTok investing videos with questionable advice.
Boneparth, along with Sam Stovall, chief investment strategist at CFRA, spoke with Insider for the story. Five of the TikTokers did not respond to Insider’s request for comment, and two couldn’t be reached through social media.
Kris Krohn, @kriskrohn, advised his 832,000 followers to avoid the “401K scam” in an August 2020 video. Krohn, known for his real estate-investing advice, said “max out your 401K could be the dumbest advice that I’ve ever heard for anyone that wants to take control of their financial future.”
“I admire his passion and love for real estate, but this is just factually incorrect,” Boneparth said. “A 401k is not a scam, it offers tax advantages.”
Sam Stoval said the advice is good “only if you like to throw away money, and if you are a believer in illogical conclusions.”
“Maxing your company’s 401K match will get you free money, since the company will give you – free of charge – all or some of your contributions,” Stovall said.
Plus he said stocks, which 401Ks can invest in, have delivered an 11% compound annual total return since 1946, not the 1% Krohn claimed in the video. The retirement accounts can ensure “the building of a substantial retirement nest egg,” he said.
The @teen.executive account, which has 187,500 followers, said people can make a million dollars or more if they use soap and shampoo samples from hotels, saving about $45 per month, and investing those savings into the S&P 500.
Stovall said that practically saving money whenever possible and investing those savings “is indeed useful advice toward becoming a millionaire by the time you retire.”
But, “who’s spending $45 a month on soap?” Boneparth said, “and you still have to pay for the hotel room.”
Boneparth, who wondered if the video was made as a joke, said penny pinching on the small things isn’t the path to financial independence.
“Soap alone isn’t going to get you a million dollars here.”
Amid the resurgence in meme-stock mania around AMC Entertainment, the @atomcash account, which has 1,400 followers, said, “Mathematically speaking, it is statistically possible that AMC can reach anywhere from 100k a share to 500 or even a million dollars a share.”
“There is a huge difference between being ‘statistically possible’ and ‘realistic,'” Stovall said.
At even just $1,000 per share, the company, which is currently trading at all-time highs around $45, would be a $500 billion business.
“It’s just absolutely ludicrous to think that AMC, a company that’s bleeding cash and trying to shore up its balance sheet and survive would be worth something slightly less than Tesla,” Boneparth said.
The creator behind @ceowatchlist publishes regular TikToks encouraging his 822,000 followers to track public investing records of CEO’s, senators, and other rich people and buy what they buy.
It’s a piece of advice that a lot of investors follow, seeing how many attend the Berkshire Hathaway annual meeting and read Warren Buffett’s letter to investors, Stovall said.
“A problem with buying what rich people own, however, is that these rich people probably don’t publish a newsletter telling when to buy and sell, along with publishing a track record,” Stovall added. “Therefore, blindly buying what rich people own means you may get in late and never know when to get out.”
Tik Tok Creator @Chris.stocks detailed to his followers what a support and resistance level is, and said when you see a stock nearing it’s support or resistance level, you can predict what’s going to happen, and make money.
“That is much of the basis behind technical analysts. ‘The trend is your friend until it ends,'” said Stovall.
Boneparth said the video is a foray into how to use technical analysis for trading, but warned that the skill takes time to practice.
“There’s no secret formula to getting rich,” said Boneparth. “I’m glad people are getting interested but that’s not long-term investing. You just can’t watch this video and go buying and selling.
In another TikTok video slamming retirement accounts, @realitycheck2020 says that investors shouldn’t use retirement funds, as those charge fees while your money loses value. His solution is for investors to put money in an S&P 500 index fund, and then look for opportunities in new IPOs, cryptocurrencies, and real estate.
Stovall clarified that most retirement accounts allow you to invest in the S&P 500 at a low cost.
Boneparth summed up this video has “really broad financial advice from someone spouting their opinions about asset classes.”
“It’s not backed with any information that would help someone. It’s all predicated on FOMO, of a market that’s been treating investors well for taking risk,” he said.
@tdorriz tells Tik Tok that investors can turn their $1,400 “stimmy” (stimulus) into $10,000 by buying SPACs that are about to acquire a target company.
“If these target companies are any good, these stocks will easily double or triple overnight,” @tdorriz said in a TikTok Boneparth said this investor is incorrectly linking correlation and causation, and urged investors to do their own due diligence.
“To just go buy any SPAC and not understand is a disservice,” said Boneparth. “This advice assumes that all SPACs make money. There are no investment guarantees!” Stovall added.
In a response to Insider on Twitter, the TikToker said the idea “flopped,” but noted his video was just his opinion not advice. “80% of the stocks I buy go up in my opinion,” he said in a message.
A TikTok from @rickrahim tells investors to take out a low interest loan, “plow it all into crypto,” and take out a tiny bit of profits each month to make monthly interest payments. Boneparth and Stovall both had strong reactions to this one.
“If he’s trolling, very funny. If he’s not, that’s an extremely dangerous, borderline stupid idea,” Boneparth said. ” Do not lever yourself to invest in any speculative assets. The risk is not worth the reward. Very dangerous, terrible, terrible financial advice.”
“Anyone who believes that a particular asset class ‘always goes up’ deserves to lose money,” Stovall said. “Also, why compound a possible mistake by taking out a loan (which carries its own cost) to purchase the investment you didn’t bother to research, or, worse yet, buying on margin? You’ll only end up losing more than you initially invested.”
Former President Donald Trump on Friday announced a new personal project he’s working on: a book.
“I’m writing like crazy,” Trump said in a statement released through his leadership PAC, “and when the time comes, you’ll see the book of all books.”
Trump claimed he has turned down two book deals “from the most unlikely of publishers.” He did not provide any further details.
“I do not want to do such a deal right now,” he said.
Trump also teased he’s currently “working on a much more important project” but did not disclose more information.
Once an avid tweeter, Trump was booted from social media platforms Twitter and Facebook in the aftermath of the Capitol insurrection on January 6. Facebook announced last week the company will uphold Trump’s ban until at least January 2023.
Trump now communicates to the public through his leadership PAC, dubbed Save America, regularly putting out short, strongly worded statements, similar to how he’d tweet. The former president also launched a blog, called “From the Desk of Donald J. Trump,” which he shut down after less than a month.
“We are not discussing particulars of any individual book interviews that President Trump is giving but it’s safe to say that he remains the hottest name in politics and he’s the interview that everyone wants,” Jason Miller, Trump’s spokesperson, told Politico in March. “We’re tracking nearly three dozen post-presidency books where he will be the star.”
Jason Miller, a longtime senior advisor to former President Donald Trump, is leaving his role as chief spokesperson to lead a tech start-up company, according to a person familiar with the venture.
Miller, who worked on Trump’s 2016 and 2020 campaigns, has served as the former president’s on-the-record spokesperson since he left office in January. Miller is expected to remain with Trump’s team, though not in a day-to-day position.
Trump has already started interviewing possible replacements.
It was not immediately clear which company Miller would be leading, but a source said it is one that currently owns a social media platform that Trump is considering using. The former president was banned from major social media outlets, including Facebook and Twitter, following the January 6 Capitol attack.
A source familiar with the plans told Insider the startup is using “next-generation” technology and “blows away anything else currently on the market.”
In recent days, Miller has had conversations with leading conservative figures about the new project, Politico reported, and additional hires could be announced soon.
The move comes as members of the right continue their search for a new social media platform in the wake of Trump being barred from many social media spaces.
Instagram revealed on Tuesday how it decides what content, like posts and stories, to show you.
The company published a blog post detailing the four most important “signals” out of thousands from you that it considers when determining what you see in the Feed and in Stories.
Instagram says it:
Looks at your history of interacting with someone, like commenting on their content, to see if you’d find their post interesting
Uses information about how popular a post is, like how many likes it has, and where it was taken to help determine if it pushes it toward you
Uses information about the person who posted it and how interesting they might seem to you
Uses information about the kind of content you view to decide if a post might be interesting to you
Instagram also says it uses five interactions to dictate what you see. In Instagram’s Feed, those interactions are how likely you are to spend a few seconds looking at a post, comment on it, like or save it, and tap on the profile photo of its author.
The platform then makes “educated guesses” using this data to decide what to show you first.
Instagram wrote its Tuesday blog post to “shed more light on how Instagram’s technology works and how it impacts the experiences that people have across the app,” and the company said more posts will follow. This first post was designed to answer questions like “How does Instagram decide what shows up for me first?”
Instagram also clarified that it doesn’t just use a single algorithm to study your behavior online – it uses ” a variety of algorithms, classifiers, and processes, each with its own purpose.” The company says it ranks content differently in Stories, Feed, and Explore, such as tailoring content from your closest friends to you in Stories.
Former President Donald Trump on Saturday slammed Big Tech for deplatforming him, accusing Silicon Valley executives of ruining the country.
He also said he wasn’t interested in waiting two years to be allowed back on Facebook.
“They may allow me back in two years. We got to stop that, we can’t let it happen – so unfair,” he said. “They’re shutting down an entire group of people. Not just me. They’re shutting down the voice of a tremendously powerful – in my opinion, a much more powerful and a much larger group.”
The comments came as Trump emerged from his post-presidency hiatus to speak at the North Carolina Republican Party Convention.
He gave a meandering 90-minute speech, speaking to a mostly subdued crowd of about 1,200 seated guests, and touching on well-worn highlights of his political rallies.
Trump said President Joe Biden had been destroying the country “before our very own eyes.” He then criticized the country’s top infectious disease expert, Anthony Fauci, denouncing him as “not a great doctor.”
Trump also said the ongoing criminal investigation into the Trump Organization was part of a “five-year witch hunt” and that dead people had voted in November.
The speech was carried live on C-Span, which tagged it as a “Campaign 2024” event. Despite losing the 2020 election, Trump has a firm grip on the GOP. He told associates he planned to run again in 2024, if he’s healthy, Politico reported last month.
“We will break up the Big Tech monopoly,” he said on Saturday. “We will reject left-wing cancel culture.”
Trump took aim at Mark Zuckerberg, chief executive at Facebook, calling him “another beauty,” saying his “human nature” was ruining the country.
“This election will go down as the crime of the century,” Trump said. “And our country is being destroyed by people who perhaps have no right to destroy it. Zuckerberg broke the law, spending millions of dollars – don’t you think he broke the law? – millions of dollars to get out the vote in highly Democrat areas.”
Without direct access to the billions of social-media users, Trump has struggled to find a way to speak directly to his followers. He launched a blog called “From the Desk of Donald J. Trump,” posting statements that could be shared by users allowed on Facebook or Twitter. But readership and sharing floundered. It was also buggy. The blog was taken offline last week.
White House Press Secretary Jen Psaki on Friday said: “Feels pretty unlikely that the zebra is going to change his stripes over the next two years. We’ll see.”
Teenagers have a reputation for firmly believing they know way more than their parents. In the case of cryptocurrencies, almost half of them say they know more about these digital assets than Mom and Dad, and any interest they have in finance has been thanks to social media, a Wells Fargo survey published earlier this week found.
Traditionally, parents have usually passed on financial knowledge and expertise about money and investing to their children. The survey showed almost two out of three kids, or 57% of those polled, still agree this is the case, although this dynamic is shifting when it comes to cryptocurrency.
The Wells Fargo Parent-Teen Study on investing included 318 teens between the ages of 13 and 17, and 304 parents of teens who are 13 to 17.
The survey showed 50% of parents said their teen knew more about bitcoin than they did, while a similar percentage – 45% – of teenagers felt their knowledge of crypto topped that of their parents. The survey also found teen boys were more likely to say they know more than their parents about bitcoin than girls. 58% of boys polled said this was the case, while only 33% of girls surveyed agreed, Wells Fargo said.
In some cases this has even led to parents taking investment advice from their children – 19 year old Adam Mlamali, who has invested in stocks and has crypto holdings, for example regularly gives his mother financial advice – including telling her when to sell her bitcoin.
He believes that his mom seeing him take risks and reap profits as a result made her want to get involved, he told Insider. “She likes it when I explain my analysis to her and will then consider if she would like to invest and how much.” Adam told Insider.
Cryptocurrencies are especially popular topics on social media – where 35% of teens say they get at least some of their financial education. Parents seem to be unaware of this – only 12% said their children learnt about finance online in the Wells Fargo study.
TikToks that are tagged with #bitcoin have 3.6 billion views on the social media platform and #crypto renders 3.4 billion views. On a broader scale, #fintok, which is the financial niche on TikTok, boasts 357.3 million clicks and #stocktok, where TikTokers talk about their top stock picks and investments, has 1.2 billion hits.
So-called ‘finfluencers’, many of whom have over 100,000 followers, use social media platforms like TikTok to talk about their own investment strategies and journeys, share their top stock picks and provide financial education. Video titles range from “3 stocks that will double in 2021” over “How to turn $100 into $7,000 in crypto” to “3 steps to start investing” and “Taking out $ from a Roth IRA”. Not all ‘finfluencers’ are qualified financial professionals or have formal investment education.
Social media’s power to move markets also appears interesting to teens – 45% of those surveyed said the social media led GameStop saga that caused chaos on markets earlier in the year got them hooked on finance.
Reddit’s WallStreetBets page, where much of the GameStop short squeeze began, has over 10 million members. It also played a major role in the accelerate growth of dogecoin and is currently driving the AMC Entertainment craze – retail traders had organised themselves online, investing in the company’s stock and skyrocketing it’s stock price.
“Social media has a profound influence on our younger generations. Those generations grew up with social media and often trust many of the platforms more than their parents do,” Mariana Martinez, a family dynamics consultant with Wells Fargo’s Wealth & Investment Management group, said.
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At long last, Twitter has released its first subscription product, Twitter Blue. For now, only Australian and Canadian users can pay around $3/month to access Blue features like a 30-second grace period to undo or edit a tweet before it’s posted, prioritized customer support, Reader Mode for easier viewing of threads, and color scheme customization for the app.
Not quite the “edit” button users have been begging for and nothing particularly groundbreaking. So…why are we writing about it?
Investor pressure and advertising competition from the likes of Snapchat and Facebook pushed Twitter to look for new revenue streams. A subscription offering has been on the roadmap for years.
Big picture: Twitter’s product team must have picked up a copy of Deep Work during the pandemic, because they’ve been testing and/or launching tons of new features including…
A virtual tip jar
“Super Follows” for individual users to charge subscriptions
“We may collect biometric identifiers and biometric information as defined under US laws, such as faceprints and voiceprints, from your User Content. Where required by law, we will seek any required permissions from you prior to any such collection,” the new policy reads.
As noted by TechCrunch, which earlier reported on the changes, that language could allow TikTok the ability to collect most US users’ biometric data without explicitly asking them, due to the fact that only a few states have laws restricting companies from collecting such data.
TikTok didn’t respond to Insider’s questions about whether it had already begun collecting users’ biometric data. However, the new language is found within a section titled “information we collect automatically,” meaning TikTok could potentially be collecting it already.
TechCrunch also noted that the policy doesn’t define “faceprints” or “voiceprints,” or explain why TikTok needs this data in the first place.
In February, TikTok paid $92 million to settle a class-action lawsuit in Illinois over allegations that it violated the state’s biometric data privacy law.
Last year, the Trump administration unsuccessfully attempted to ban TikTok from the US entirely, claiming its ownership by Beijing-based ByteDance posed a national security threat.
While President Joe Biden on Thursday issued an executive order banning Americans from investing in Chinese firms linked to surveillance of religious and ethnic minorities, his administration hasn’t taken an explicit position on TikTok.