Stock Tweets May Screw With People More Than Help Them In Making Sound Investments

Everyone loves to predict how the stock market moves, because if they know or think that they know how the stock market behaves, they can either manipulate the stock market to their favors or just make outrageous amount of money.  It’s no stranger that the stock investors have been using electronic technology to aid them in making money in the stock market.  So we can safely assume that stock investors are somewhat technological savvies.  Some so called stock market investors also think Twitter can help them read stock market trends so more money can be made.

In my opinion, stock market is a beast that will swallow anyone who thinks of taming it except the very few stock savants.  It’s better to approach the stock market with insightful fundamentals of certain industries than reading the noises on Twitter.  Before I continue on, just to let you know I’m not an expert in stock market, but as any other human fellow, I’ve a lot opinions and brain power to mobilize my words across by blog.  I’m glad to clear that out so everyone of you has to think twice before blaming me for your miss opportunities within the stock market.

Anyway, Twitter is like a river that will carry just about anything you throw into it.  The stock market itself is already a noisy place, and adding Twitter into the confusion may make the matter worse.  Perhaps, it’s true that when there are a lot of people tweet about a stock, it may be a sign that signifies to everyone that the stock has something good or bad going on.  Then again, if that is always the case, everyone can just follow tweets and make money from the stock market.  Unfortunately, the stock market is also a market of human emotions.  Humans tend to rush to do things at wimps of changing emotions.  With that I mean not all human emotions arrive at common sense.  This is why the same stock can plunge today but rise higher tomorrow.  All of that though only good for short term stock traders such as day traders who care only about gaining a profit within hours.  Long term stock investors probably will not reap any benefit from dipping their toes into Twitter’s stock trends.

In the end, true value of a stock depends on the company it represents, and the company has to have good fundamentals to boost its stock in many years to come.  Here are just some examples of good fundamentals of a stock:  Great management team, huge market capitalization, leader of the market, innovative technology, low debts (depending on an industry), clear and easy to understand balance sheet, huge dividend if the company isn’t anticipating on expanding, low price per book, favorable political weather, and so on.  I think those fundamentals will be greater help than following the streams of tweets on stocks.

Disclaimer:  It’s up to each own mind and heart to decide how he or she is going about investing in the stock market.  Essayboard isn’t a blog on the stock market, and so you should not read for stock tips here.  Instead, my opinion is that following unknown stock tweets from strange sources for making a decision on what stock to buy or sell can be a very bad idea.

Source:  http://gigaom.com/2011/04/06/can-twitter-help-you-predict-the-stock-market/?utm_source=feedburner&utm_medium=feed&utm_
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