Reuters on $TICKER; Why the cashtag matters on Twitter and StockTwits

Twitter is an online social networking service and microblogging service that enables its users to send and read text-based posts of up to 140 characters, known as "tweets". For stock market investors, Twitter began as a retail oriented tool, and it has since evolved into an institutional investor tool. This is confirmed in this story by Reuters: How investors use Twitter:

"Ever since the $TICKER tag was introduced on Twitter two years ago, active traders and investors have used the 140 character message stream to share tips, ideas and news. Most companies whose stocks were the subject of those tweets ignored the chatter the same way they ignore online chat rooms. Worried about inadvertent selective disclosures, corporate spokespeople kept their own Twitter conversation focused on routine PR matters, and steered away from financial and investor information.

That is changing fast as companies figure out how to tweet without crossing the foul line. A recent study of more than 600 public companies using social media found that two-thirds of them employ Twitter to communicate directly with investors, up dramatically from two years ago when just a handful were starting to tweet.

The study, conducted by Q4 Web Systems, a Toronto-based consulting firm that advises corporations on using the web, reported that natural resources and tech companies represent the greatest number investor-tweeting companies, followed by services, industrials, basic materials, and retail companies.

The survey cited emerging “best practices” these companies use when tweeting investors, including:

• live tweeting during earnings conference calls, analyst investor days and annual meetings;
• reaching out to investors for questions prior to an earnings call;
• answering investor questions live for all to see;
• linking to breaking news, analyst reports and opinions on the company or the industry;
• inviting followers to webcasts, conference calls and video blogs;
• using unique #HASHTAGS for specific events to make them easier to find later."

When Derwent Capital raised an insitutional hedge fund based on Twitter sentiment, the views from market professionals changed as identified by this article at The Atlantic Wire:

"You might think a 140 character tweet doesn't have much power, but, as one hedge fund proved, Twitter can help you win the stock market. "Derwent Capital, the hedge fund that is using Twitter sentiment to make its investments, beat the market--and other hedge funds--in its first full month of trading," Lauren Dugan reports. Using an algorithm based on the social media mood that day, the hedge fund predicted the market to make the right trades. Sounds unbelievable that something cluttered with mundane musings and media links could have anything smart to say about the market. But it's working so far.  

The idea behind it. Social media is a powerful force in the market--we think it could be making things worse. This algorithm puts those ideas to the test. It's based on a paper that came out of University of Manchester and Indiana University, which found a correlation between mood and Twitter, explains Bloomberg's Jack Jordan."

StockTwits - Next up was StockTwits, which is a verticle style application of Twitter focused in on being "a communications platform for the investing community". StockTwits is specific to investors. Twitter has financial messaging co-mingled with consumer messaging.

StockTwits boasts having a solid mix of professional traders, long-term investors, and hedge fund managers.  As such, the StockTwits site has significant appeal for companies looking to have their message heard. The company was founded in 2008 by long-time investor Howard Lindzon.

StockTwits created the $TICKER tag to enable and organize “streams” of information around stocks and markets across the web and social media. These streams provide new forms of insight, ideas and information that are used by investors, analysts, media and others as they research stocks and manage their investments. Other sites that use $TICKER include InvestorsVillage.com, InvestorsHub.com and TweetTrader.net.

A distinctive benefit to posting a message on StockTwits as opposed to Twitter is the "distribution reach."  All messages sent through Twitter are automatically posted on StockTwits, and they make their way to:

• CNNMoney.com,
• Yahoo! Finance,
• Bloomberg,
• The Globe and Mail,
• Bing, as well as
• Twitter, Facebook and Linkedin.

Much of ProActive's distribution from the ProActive Newsroom.com is via our ProActiveNR Twitter account and our client's Twitter accounts which feed into StockTwits $TICKER system.

Today, more than 150,000 investors, market professionals, and public companies share information and ideas about the market and individual stocks using StockTwits, producing streams that are viewed by an audience of over 40 million across the financial web and social media platforms.

With StockTwits’ Investor Communications Solutions any public company can quickly add their official communications to the $TICKER stream for their company on the StockTwits platform, across the leading financial web properties, and on Twitter, LinkedIn and Facebook – all from one centralized interface that provides metrics, monitoring, compliance, and workflow tools.

StockTwits is currently testing premium accounts for professional investors requiring compliance, workflow and analytics capabilities to fully take advantage of the StockTwits financial communications platform.

Google - If you Google our client "UNIS", it comes up with 239 million results and the United Nations International School is at the top of the page. If you Google "$UNIS", it comes up with 4050 results and every single result is about our client Unilife Corp (NASDAQ: UNIS).

$TICKER is fast becoming the new norm on Social Media sites as it allows stock information to be shared easily. Look for traditional sites to pick up this sharing capability soon.

Forbes - Become a Social Business follows The ProActive Network Model

Here is some nice confirmation of The ProActive Network model:

"With newspaper circulations down, television commercials easily skipped and social media the number one activity on the web, brands are naturally following the crowd by going ‘social’ and joining millions of people online.

They’re setting up Twitter accounts and Facebook pages. They’re getting on Google+ and even dipping their toe into LinkedIn. Some have started blogs and created Flickr or Vimeo accounts to share pictures and videos.

Whilst this is all worthwhile, many brands are still getting it completely wrong. They’re trying to integrate social media into their old ‘marketing mix’ rather than understanding the whole purpose of social media.

They’re missing the point by throwing out one-way marketing messages like before, screaming things like ‘Buy This’ and ‘Get your 20 per cent discount today! Ok maybe that last message pulls a lot of eyeballs but is that any way to build a premium brand?"

See the full Blog story @ Forbes

Social Media Stats - 65% of online adults use social networking sites

The Pew Institute had these updated statistics on the growth of social media:

Looking at usage on a typical day, 43% of online adults use social networking, up from 38% a year ago and just 13% in 2008. Out of all the “daily” online activities that we ask about, only email (which 61% of internet users access on a typical day) and search engines (which 59% use on a typical day) are used more frequently than social networking tools.

Among internet users, social networking sites are most popular with women and young adults under age 30. Young adult women ages 18-29 are the power users of social networking; fully 89% of those who are online use the sites overall and 69% do so on an average day. As of May 2011, there are no significant differences in use of social networking sites based on race and ethnicity, household income, education level, or whether the internet user lives in an urban, suburban, or rural environment.

The statistics behind video according to Pittsburgh.....

Our operations staff in Pittsburgh, PA has been pushing clients more and more to using video in their stories. On the web, video is already a major player in the content arena and is predicted to increase in the coming years making up for 90% of all consumer traffic by 2013. More and more users are choosing to interact and engage with video in ways that were never done before. YouTube users now upload 48 hours of video every minute! This is an incredible amount of video content being uploaded to the web every day. With these kinds of numbers it’s no wonder more and more content creators will be using video as their mode of driving traffic to their site. Currently there are many different ways to engage people through video that can lead to greater traffic, and the data below show why video needs to be part of social media content.

FINRA's Guidance for Broker Dealers - #finra

SEC to receive guidelines in Q&A format within weeks

It appears that Social Media (we call it Digital Media) is finally getting some guidance from FINRA as far as what brokers and Broker Dealers can and cannot do:

The Financial Industry Regulatory Authority (FINRA) plans to release to the Securities and Exchange Commission (SEC) in a matter of weeks new guidance on social media usage by broker-dealers and their advisors.

The additional guidance, which must first be approved by the SEC, won’t “change any of the fundamental principles” in FINRA’s Regulatory Notice 10-06, which was released in January 2010 and focuses mainly on recordkeeping rules for social media usage, said Joseph Price, senior VP for advertising regulation/corporate financing at FINRA, during remarks at the Insured Retirement Institute’s (IRI) regulatory conference in Washington on Tuesday.

Full Story @ Advisor One

Hey Jeff, why the focus on Social Media?

I often hear clients and partners ask ProActive's CEO Jeff Ramson, "Why the focus on Social Media?" We actually like to use the word Digital Media as it tends to draw more business attention and focus. Regardless of the semantics, ere are some impressive Social and Digital Media facts from LiveScience.com:

• 1 in 5 couples meet online
• Lady Gaga, Justin Bieber and Britney Spears together have more Twitter followers than the entire populations of Sweden, Israel, Greece, Chile, North Korea and Australia
• If Wikipedia.com were made into a book, it would be 2.25 million pages long and would take about 123 years to read
• Social media has overtaken pornography as the top activity on the Internet
• An education study revealed that online students out performed those receiving face-to-face instruction
• Kids are starting to learn on iPads, not chalkboards
• Facebook tops Google in weekly U.S. traffic, and if the social networking site were a country, it would be the third-largest behind China and India
• 69 percent of parents are "friends" with their children on social networks
• A new member joins LinkedIn every second
• The Ford Explorer launch on Facebook generated more traffic than a Super Bowl ad
• Gen Y and Gen X consider e-mail passé. Some universities have even stopped distributing e-mail accounts
• E-books have surpassed traditional book sales
• A baby in Egpyt has been named Facebook to honor the social networking site's role in the country's revolution
• Groupon will reach $1 billion in sales faster than any company in history
• 24 hours of video is uploaded to YouTube every minute

A new YouTube video from social media expert Erik Qualman, author of the book, "Socialnomics: How Social Media Transforms the Way We Live and Do Business" (Wiley Publishing, 2009), which breaks down the power of the medium with the help of real-world examples, has been making the rounds online since its debut earlier this month.

The "Social Media Revolution 2011" video is an updated version of his wildly popular clip from 2009, which aimed to show how social media is here to stay and how it is perhaps the biggest shift we're seeing since the industrial revolution, Qualman suggests in his video.

To watch his latest clip for more mind-blowing stats, watch on the video.

Canada gets "it" too, social media impacts stock prices

The basis of ProActive's PRISM technology and philosophy was confirmed in a paper by Professor Eugene Soltes of the University of Chicago Booth School of Business. Published in 2009, Soltes’ paper News Dissemination and the Impact of the Business Press states:

“How information is distributed, even when public, is important. Ultimately, I find that the press has a significant effect on bid-ask spread, share turnover, and idiosyncratic volatility. Specifically, greater dissemination of firm news is found to lower bid-ask spreads, increase trading volume, and lower idiosyncratic volatility.”

In a separate study, Professor Terrance Odean of the University of California, Berkeley and Professor Brad Barber of University of California, Davis stated in their paper All that Glitters: The Effect of Attention and News on the Buying Behavior of Individual Investors:

“Consistent with our predictions, we find that individual investors display attention-driven buying behavior. They are net buyers on high volume days, following both extremely negative and extremely positive one-day returns, and when stocks are in the news. Attention-driven buying is similar for large capitalization stocks and for small stocks.”

This week Dominic Jones of IR Web Report reported a story about data that has come out of Canada in reference to social media's impact on stock prices in Canada. He states:

"The survey, released at this week’s Canadian Investor Relations Institute (CIRI) annual conference, was conducted by PR wire service CNW Group and market research firm Leger Marketing. It polled 99 investor relations professionals, of which 56 (57%) said they use social media for business. Of the 56 IR professionals who use social media for business,  49 were Canadian and 7 were from the US.

In the survey, 71% of the IROs who use social media for business agreed with the statement that social media activities and discussions influence investment decisions while 7% disagreed. Asked for their views on a statement that social media activities influence share prices, 64% agreed and 13% disagreed."

The study also covers the question of budgets and are they being allocated specifically for social media:

Full Story @ IR Web Report

Why we like StockTwits as a platform and a company...

Hubspot's 100 Awesome Marketing Stats, Charts & Graphs

Our friends at HubSpot have posted their newest collection of 100 Awesome Marketing Stats, Charts & Graphs. This list is based on original research and data from a variety of sources, including analysis of Hubspot's  4,500 customers, surveys with hundreds of small and medium-sized businesses, and dozens of top-notch publications like MarketingSherpa, eMarketer, Pew Research, McKinsey, and more.

100 Awesome Marketing Stats, Charts and Graphs

View more presentations from HubSpot Internet Marketing

Read more: http://blog.hubspot.com/blog/tabid/6307/bid/14416/100-Awesome-Marketing-Stats-Charts-Graphs-Data.aspx#ixzz1PNiFkKcU

LinkedIn IPO - Round 2 - What really happened?

The LinkedIn IPO has brought in lots of commentary. The Sydney Morning Herald brought in this headline:

"The old boys' network: LinkedIn reveals investment bankers up to nasty old tricks"

I have no doubt that almost everyone at LinkedIn was thrilled to see the run-up; most executives at start-ups usually are. An IPO is an important marker. And, of course, the executives themselves are suddenly rich. But, in reality, LinkedIn was scammed by its bankers.

The fact that the stock more than doubled on its first day of trading - something the investment bankers, with their fingers on the pulse of the market, absolutely must have known would happen - means that hundreds of millions of additional dollars that should have gone to LinkedIn wound up in the hands of investors that Morgan Stanley and Merrill Lynch wanted to do favours for. Most of those investors, I guarantee, sold the stock during the morning run-up. It's the easiest money you can make on Wall Street.

As Eric Tilenius, the general manager of Zynga, wrote on Facebook: ''A huge opening-day pop is not a sign of a successful IPO, but rather a massively mispriced one. Bankers are rewarding their friends and themselves instead of doing their fiduciary duty to their clients.

Reality is that LinkedIn and its Board were in control of the pricing. They clearly saw the orders before they signed off on the pricing. Long before the IPO day they chose to NOT follow the path of Google who did a "Dutch Auction" for their IPO in 2004.

In a Dutch auction, a company reveals the maximum amount of shares being sold and sometimes a potential price for those shares. Investors then state the number of shares they want and at what price. Once a minimum clearing price is determined, investors who bid at least that price are awarded shares. If there are more bids than shares available, allotment is on a pro-rata basis--awarding a percent of actual shares available based on the percent bid for--or a maximum basis, which fills the maximum amount of smaller bids by setting an allocation for the largest bids.

Google's success in pulling off a large-scale Dutch auction was due to its tremendous brand recognition and huge financial resources. LinkedIn conducted a traditional IPO in which underwriters' promotional work heats up the market for shares.

To say that LinkedIn was not in control is a little disingenuous.