Trefis.com is a great site to model up technology companies. There are some great tools — some analytical, some social, that allow investors to play around with growth/profitability assumptions to forecast a stock price.
Crowdsourcing, the collective wisdom of the crowds, has been show to have strong correlation to future results specifically in sporting events and election polling. Here’s how Tradestreaming addresses crowdsourcing.
Given the fact that academia stuck to its guns for SO long with the Efficient Market Hypothesis (that all information is embedded currently into a stock prices, making it really hard to ‘beat’ the markets), we’re just seeing relatively new research that is open to crowdsourcing investment ideas and some that finds that there is MAJOR outperformance.
For example, check out the Harvard Kennedy School’s “The CAPS Prediction System and Stock Market Returns” paper that studied results of the Motley Fool’s crowdsourcing CAPS platform. Specifically, the paper looked at the difference in returns between the most highly rated stocks and the lowest rated stocks. The paper found huge double-digit outperformance (18%).
3 ways to crowdsource investment ideas now
Piqqem: This site allows users to rate stocks on a 5 factor scale. More importantly, Piqqem has a portfolio tool that enables users to create and backtest strategies based on the changes in investor sentiment for individual stocks. Check it out.
Intrade: The mother of all prediction markets, Intrade does huge business in sports betting but also has contracts on financial outcomes. Intrade wagerers buy and sell probability contracts on Dow Jones and S&P predictions.
Mint’s new Goals feature seeks to take the difficulty out of both setting goals and regularly tracking your progress towards those goals. With a few clicks of the mouse, you can set up a savings goal, and then use Mint.com to help you achieve that goal.
Using Goals for Saving for the Future
So, if a Mint user wanted to save for something like home improvements, they’d use Goals to:
Set funding source
Set goal dollar amount
Blend in financing options
Establish target date
Specify monthly savings target
Makes perfect sense, right?
So, the move from helping people track to helping them plan is an obvious one and a good move for Mint.
And Mint’s revenue model/value proposition work well for this foray into planning. I assume Mint will begin to gain referral fees as they recommend loans, travel services — anything that helps assist in the savings and planning process.
We’ve seen investment platforms begin to automate professional grade services to their client in an effort to round out their offering and attract full-service clients (see my review of E*Trade’s Online Adviser). Now, we’re seeing personal finance sites begin to creep into the financial planning/investing/future-oriented space.
What get’s me juiced is that sites like Mint have a TON of information about their users — the type of information the investment portals and online brokers drool over. This positions them better for a move into investing — much like the much ballyhooed-TechCrunch Disrupt-winner Betterment is focused on.
Mint.com Expands Into Financial Planning Tools (NY Times)
How To Set and Track Financial Goals With Mint (Mint blog)
AdvisorShares Investments, LLC, a developer of and investment adviser to actively managed Exchange Traded Funds, announced today a partnership with Cambria Investment Management, Inc., a Los Angeles based investment manager, to create a GTAA strategy in an actively managed ETF. The proposed ETF would join AdvisorShares‘ growing stable of innovative actively managed ETFs
I’m grateful for your attention, and happy that we have opportunities to communicate in various places on the web. If you’re interested in having a souvenir of all these interactions, boy have I got the gift for you!
Top investment gurus like Benjamin Graham, Warren Buffett, Peter Lynch, and Joel Greenblatt didn’t only help investors enjoy huge market-beating returns in their funds. They also left behind the keys to the (investing) castle: the methodologies they applied in their market-trouncing performance. They’ve written books, complete with formulas and strategies, that propelled them to the top of their games and gains. Tradestreaming aims to recreate these strategies as we pave our own way to outperformance.
Because a small number of expert investors wrote extensively about their investing techniques, we can now create complicated computer programs to reenact their strategies and apply them to today’s stock markets. Screening 2.0 is all about using smart technology to bring history’s best investors back to life.
Stock screens have been around for decades. Using screens, we can filter through thousands of investment candidates on the prowl for the ideal investment. Old screens merely searched databases of stocks using specific criteria (i.e. all large cap stocks with a p/e less than 20 and a growth rate over 7%). Unfortunately, for most investors, these screens fail — searching for specific stocks tells us nothing about the success of such a strategy.
Screening 2.0, lead by analysis and money management firm, Validea, allows us to recreate history’s best investment strategies, computerize them, and then look for stocks that guru investors like Ken Fisher and Marty Zweig would have purchased themselves. Screening 2.0 is the marriage of search technologies and artificial intelligence with quantitative investing.
Tradestreaming is a community of investors learning directly from experts. I’m Zack Miller, investor, entrepreneur, and founder of Tradestreaming.com and I literally wrote the book on how to invest in the age of Facebook and Twitter. Tradestreaming is the resource I’ve created to help me become a better investor. I believe it will help you … Continue Reading
Tradestreaming is all about using technology tools, social media, and strategies to become better -- more accurate -- investors. Zack Miller is the author of Tradestream your Way to Profits: Building a Killer Portfolio in the Age of Social Media (Wiley, 2010).