If you’re looking for the most recent information on investments and relevant business-building ideas, social media is where you should be, says Michael Newton, a Toronto-based portfolio manager with ScotiaMcLeod Inc.
“[Social media] is not about what Jay Z or Beyoncé wore or had for dinner,” Newton says. “It depends on what you’re looking for.”
You don’t have to be a prolific user of sites like Facebook and Twitter to gain from social media, according to Barbara Gray, equity analyst and founder of Vancouver-based Brady Capital Research Inc. But you should definitely consider creating accounts to stay on track with your investment news.
Here are three ways to gain knowledge through social media:
> Learn about a company’s social capital
Social capital is the goodwill a company gains from the way it treats its stakeholders, which includes any individuals who interact with the company, such as its investors, its employees, its customers and the local community.
While you may not find a company’s treatment of its stakeholders reported on earnings reports or balance sheets, you will find the general public discussing the good, the bad and the ugly of companies through social networks. And a company’s earnings can be affected by what their customers are saying online.
“Social media is really an accelerator,” Gray says. “It’s ‘word of mouth’ gone viral.”
> Discover the most current investment news
If you’re waiting with bated breath for a company’s earnings report, Twitter is the place to be.
“As soon as the company reports, it’s going to be tweeted about,” Gray says. “And that will take you right to their press release.”
Also, by typing a dollar sign immediately followed by the company’s stock symbol, you will see up-to-the-minute business news regarding any particular stock. For example, to view any investment updates for Tim Hortons, type “$THI” into the social-media network’s search engine.
Newton tweets regularly but also uses the site to find out the back story of changes to his investments. For example, earlier this summer, a gold stock he follows jumped up by 70%. He was unable to find out why through the company’s website or other traditional means.
“I punched the [stock] name into Twitter,” Newton says, “and I saw ten posts saying there were strong rumours that it was going to be bought out by [another] company.”
A few hours later, that pending transaction was officially confirmed.
What you find on social media might not necessarily be fully accurate, Newton says. But it can give you an indication of what people are saying about it.
> Follow and learn from experts
You can find top authorities from any industry on Facebook, LinkedIn and Twitter.
For example, Gray is a fan of business strategy books and follows their authors on Twitter.
“Most of the authors are from academia,” she says. “So the content they share is really high-quality.”
For example, Gray keeps up to date with what Don Tapscott (@dtapscott) and Bill Taylor (@practicallyrad) are saying on Twitter. Tapscott is a renowned Canadian professor who writes about media and technology’s economic and social impact; Taylor is a popular writer and speaker known for his knowledge on business innovation and management.