Social media really began to come to the fore about a decade ago, around the same time smartphones began making their way into our hands. Prior to that, social networks had existed, but had not become what they are today – a bona fide source of news for many people, and our prime means of communicating with our wider network outside of our closest family and friends.
The Advent of Twitter
Facebook allowed us to connect with those we knew, but Twitter allowed us to broadcast to anybody who wanted to listen, and also pick up the latest news and musings from people who didn’t reciprocate the connection like celebrities and experts. All of this changed how we think about news, and allowed everybody to effectively gauge opinion on any topic they wanted using a quick hashtag search.
Gauging Opinion on Twitter
Naturally, this is something used not only by people who want to see what the rest of the world thought of the latest revelations in Game of Thrones, but also in business and politics. While Facebook is still somewhat closed in nature, and people tend to post far less frequently due to its more personal nature, on Twitter there is no etiquette against tweeting hundreds of times a day, and so people tend to provide live coverage of both grand and minuscule events, and broadcast their thoughts on everything. If a business wants to know what people think of their new ad campaign, they can bet that people will tweet about it. Equally, if a politician wants to have their ideas and reactions to breaking news seen, they had better be on Twitter.
Twitter and the Markets
The markets are something that are fast paced and work in real time, and so Twitter is the ideal medium for people who want to get information about things that might affect their trades. A Twitter feed with the right accounts followed on it can be about the most useful thing a forex or stock trader has during a trading session. However, it is worth considering the reverse – that in some cases, the markets may be somewhat informed by what is happening on social media.
When you look at the reactions to Trump’s tweets, which are an almost daily source of news, there is a sense that this is a platform everybody can see, and that whether key influencers like or dislike what he has said, it could affect things like confidence in the US currency. As an example, he recently tweeted about banning transgender people from the military before announcing it anywhere else, which caused a lot of controversy. It is hard to say, as this happened on a day of Fed rate decision announcements, whether this had much of an impact on the dollar, but as things trend on Twitter it is clear that people all over the world – including world leaders, investors and decision makers – are just as likely to be talking about them as anybody else.
Twitter itself has been public for quite a while now, and was a stock, like Facebook and Snap, that a lot of millennial investors bought into as they identified with the brand. Whether you play the stock market or not, you are probably aware to some extent of Twitter’s stock performance, because it tends to get news coverage as a major brand, and of course, because people tweet about it. This gives the kind of ‘meta’ feeling that tweeting about Twitter stocks may be affecting Twitter stocks!