Posted on June 11, 2010 at 9:35 am UTC
Now, with online distribution and retail, we are entering a world of abundance. And the differences are profound.
—Chris Andersen, The Long Tail
Blogging investment ideas
As fundamental, structural changes have occurred in the stock research industry over the past few years, investors no longer have to rely on their brokers to get access to information about investments. A scarcity of information with limited distribution has given way to almost unlimited abundance of information widely available. Technology investor and venture capitalist Fred Wilson calls this entire process a dislocation “because of this move from scarcity and exclusivity to abundance and scale.”
The velocity of information is continuing to accelerate, led by technological advances in Internet connectivity, social media, push email, blogs, and an easy-to-use method of publishing Internet content, Really Simple Syndication (RSS).
News + Blog Analysis = Actionable, tradable information for investors
Bloggers are quickly rivaling investment bank analysts and top journalists in their capacity to research a broad swath of stocks as well as drill deep down in their analysis. As financial information has become more democratized, investors should harness the long tail to help make sense of it all. In turn, this new model provides investors with a real-time research platform to bubble up previously undiscovered investment opportunities and then surgically analyze them. Blogger opinion resides in the long tail, a tremendously valuable repository of information just waiting to be tapped.
Sites like Seeking Alpha and Stock Twits enable investors to tap into great investment research being published 24/7 around the world.
<- Previous: Part 2: What is Tradestreaming I Next: Piggyback Investing ->
Photo credit: mikebaird
Posted on June 10, 2010 at 7:30 am UTC
Learn and invest like the big boys
Tradestreaming is about using social media and Internet resources to plug into the collective investment activities of the world’s best and most profitable investors. Research has shown that by piggybacking these guru investors — investing in some of the same stocks they’re buying — provides us close to the same returns as we would rack up if the top hedge funds — people like SAC’s Cohen, Berkshire’s Buffett, Carl Icahn and George Soros — managed our portfolios directly.
How to piggyback invest
The great thing about today’s investing environment is that there is an increasing level of transparency to some of the top hedge funds’ activities. They’re required (or encouraged) to file periodic reports of their holdings. These reports are a gold mine of information as investors get a window into what these guru investors are investing in or selling out of their portfolios.
With Tradestreaming, we would need millions of dollars of investable assets just for these top funds to consider managing our monies. Instead, by mimicking hedge fund activity, we essentially outsource our research to the brightest and most profitable funds and invest alongside them.
Sites like AlphaClone and Marketfolly help us decipher exactly what investment funds are doing. There are a lot of tools that can assist in this process. That’s what Tradestreaming is all about.
<- Previous: Ride the Long Tail I Next: Follow the Insiders –>
Photo credit: theyoungones
Posted on June 9, 2010 at 9:19 am UTC
This is part two of a series that takes a birds-eye view into the concepts I develop in my book, Tradestreaming. Readers should also subscribe to my newsletter to stay on top of all news, posts and share in some of the ideas I’ll be developing. Subscribe here.
A Sucker’s Game
Tradestreaming is a new way to invest, made possible by Facebook and Twitter. Today’s Internet provides a level of transparency that’s never been experienced by investors. Fully taking advantage of social media from an investment perspective requires an understanding of what’s behind this change. Tradestream Your Way to Profits provides a methodology, a new way to look at investing, by using the Internet and social media to better research and mimic successful investing strategies. In this sense, the book occupies the meaty space somewhere in between a classic how-to investment book and a typical business book.
Tradestreaming = Better Way
I write a lot about the financial content and investment research industries and how the Internet is changing the rules of the game. But this analysis is done with an eye on providing actual investment strategies that best leverage this transformation. Investors themselves can decide how to proceed given the theories I develop. While investors will learn proven techniques that have been shown to make money, there are no specific formulas associated with tradestreaming. Rather, investors should finish this book smarter and more knowledgeable about what really works for profitable investors and how to use the Internet to tap into it. Tradestreaming is about identifying successful investors, strategies, and powerful computer programs and following their every move.
For investors, imitation really is the most profitable form of flattery.
Trying to beat the market may be enjoyable, but it’s a sucker’s game and not one that I want to play anymore. Social media has made it possible to easily re-create battlefield-proven investment strategies of all sorts. This book describes the strategies, how they work, and how investors can begin using them to become better investors. Investing is an ongoing learning process. Reading this book should be the start of that process, not the end.
<- Previous: Part 1: What is Tradestreaming I Next: Ride the Long Tail ->
Posted on June 8, 2010 at 1:32 pm UTC
In the age of researching investments, tradestreaming, and social media, the new Bloomberg.com site falls flat on its face.
My readers typically know me as a fair, objective reviewer of products and services. And, in truth, I am. I‘ve been extremely positive about some of the moves Bloomberg (the company) has taken (especially the scoop-up of consumer business/investing mag, BusinessWeek). But the redesign of the flagship website, Bloomberg.com, doesn’t impress. You can see the preview site here.
While everyone knows Bloomberg for its business of supplying research terminals to the top banks and investment funds, Bloomberg.com has always been a formidable offering for the consumer. Arguably, their news is written by journalists with more financial training, turning out articles that go deeper on important issues than do those of the firm’s peers. The result is one of the top investing websites in 2010.
Bloomberg.com has been derided by their competitors as a half-baked offering. The quip was that Bloomberg was totally focused on the terminals and didn’t care enough about the Web to invest resources in the site. So, the redesign (I’d have to think) was an attempt to quell those concerns and show that Bloomberg understands this whole social media investing thing and can develop a product that is as relevant as other top investing resources.
Why the site misses the mark
I know what the peeps at Bloomberg were thinking. They’ve had a black and orange theme going for years on the site that tried too hard to resemble the look and feel of a terminal monitor. Also, the old site felt jumbled — it gave the user the feeling that new modules were added-on throughout the life of the site wherever they fit.
So, the new site was designed to undo all this. White background, bright colorful accents. But, the site looks unprofessional. It just does. It also masks the true depth and volume of content that Bloomberg contains. It looks unfortunately too much like a spam blog.
The Good News
The good news is that the quality of Bloomberg content has not been diminished and I’m sure I will continue to spend a lot of time on the site, reading, learning and trading. I’ll still tune in to some of the best financial podcasts anywhere. I’m just disappointed that this may be the final product.
Posted on June 6, 2010 at 12:23 pm UTC
Here is a short compilation of top business books taken from the New York Times best seller list (if you purchase off these links, my Amazon account gets credited a minute sum). Hopefully, this is useful. Some, if not all, of these titles should be on your nightstand.
Top Business Books for June 2010
The Big Short: Inside the Doomsday Machine (Michael Lewis): Subprime, baby, and nobody tells it like Lewis.
Crisis Economics: A Crash Course in the Future of Finance (Nouriel Roubini): Dr. Doom is back and it’s gloomy.
13 Bankers: The Wall Street Takeover and the Next Financial Meltdown (Johnson and Kwak): Too big to fail actually failed.
The End of Wall Street(Lowenstein): It’s all about liquidity and capital.
How an Economy Grows and Why It Crashes (Schiff): From finance to politics, Schiff tells it like it is in pain English.
Too Big to Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves (Sorkin): The NY Times editor rounds out the doom and gloom and spins a comprehensive — and chilling — story.
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