Email
Password
Remember meForgot password?
    Log in with Twitter

article imageStock trading 101: Listening to the market

By Georgia Williams     Mar 10, 2016 in Business
Late last year American DJ and composer, Jace Clayton, used an unconventional source for his musical inspiration: stock charts.
The musically-inclined Clayton used his own system of algorithms to turn the unique peaks and valleys of the stock market activity into vocal melodies.
While this may be the newest way to literally listen to the markets, investment specialists and traders have listened to the market for years in an attempt to predict stock patterns and greater economic trends.
Listening to the market has gotten easier over the years with the rise of financial focused television networks, websites and blogs. According to Stocktrader.com, watching CNBC for 15 minutes a day “will broaden an investor’s knowledge base,” while also exposing the investor to valuable market information.
Institutional investment specialist Wayne Wew believes there has never been a better time for amateur investors to get involved in the markets. “It is incredibly easy to listen to the markets and make informed, calculated investments,” noted Wew. “It was much harder even a decade ago when the information was less user friendly and harder to find.”
Wayne Wew points to news sites like the Wall Street Journal, Yahoo Finance and Google Finance as worthwhile resources for new investors and those interested in learning more about stock options.
“The self-educated investor monitors the markets and reads headline stories every day,” explained Wayne Wew. “The investors expose themselves to current trends, third party analysis and prevailing economic concepts, all of which can help them make informed investment decisions.”
In addition to keeping up-to-date with the latest market news, Bryan Maltier, an investment expert and blogger, advises investors to first create a comprehensive investment plan, then listen to it carefully. “Think of your investment strategy as a map you use before going on a trip,” writes Maltier. “You determine where it is you’re going and you then figure out how you’re going to get there. This is because the destination is your retirement goal and you want to be efficient in reaching it, maybe even retiring early.”
Through understanding investment goals and associated risk, investors can re-strategize when needed to mitigate risk and increase profits, which, of course, is the goal of all investors.
In recent years, a new trend has emerged amongst those who actively listen to the financial markets. “Social listening” has been touted as the new marketing technique that allows businesses to know what their customers are saying about their products and their brand. However, a new by-product has also emerged - that’s “social listening” to get ahead in the stock market.
Twitter has become more than a mere social media tool — traders and stock specialists have turned to the website’s constant stream of data as a tool to decipher the next big investment opportunity. “The use of unstructured data feeds by quantitative trading firms has skyrocketed from 2 percent, in 2012 to roughly 35 percent in 2015,” says Darren Hunter, Forbes Magazine contributor.
While financial analysts are quick to point out an investor shouldn’t solely rely on information gleaned from Twitter to guide their investments, when used responsibly, in conjunction with well thought-out analysis, social listening provides another tool for investors to listen actively and make the best investment decisions.
More about Investment, Markets, Stocks