As traders we all have a love-hate relationship with Twitter. If used correctly Twitter is a great tool for traders. The benefits of twitter include:
- Forging relationships with other traders thousands of miles away
- Learning from others
- Getting a feel for what sectors or stocks are hot
Let’s use some real life examples to show application of these benefits. One of my newest and already best trading friends lives in Eastern Europe. I had posted a quote on twitter that connected with him, he contacted me and from there we learned we both share common interests in trading, science fiction, basketball, greek philosophy and 70s muscle cars. Where in the world would I have ever met someone with my eclectic tastes but on Twitter?
Not only can Twitter be used to make trading buddies, but also as an effective learning tool. It has never been easier to learn from other profitable traders. If you can find a helpful and transparent trader on twitter that posts helpful tweets, links to their blogposts or a premium service, you should jump on it.
The only use I have for Twitter when it comes to actual trading is to get a feel for what sectors or stocks are hot. While I never base trades on anything I see on Twitter, if a stock or sector that is not already on my watch list is mentioned by 5 different traders I respect, I will pay attention. While that alone will not get me to trade a stock, it may make my focus list.
These three fantastic benefits are why I love Twitter.
Now why do I hate Twitter? Let me count the ways:
- It’s a free for all mostly made up of bad traders giving bad advice
- Information overload that leads to overtrading and micro-managing positions
- It’s full of “look at me” narcissists that aren’t in it to help others and selectively post trades
- It is a time waster
- Time frame confusion between day traders and swing traders
- Compounds the emotional extremes that traders often face
- It’s full of negative people who look to ridicule others
We don’t need to dig deep into this list. It is more than likely you have experienced all seven of these twitter negatives. Rather, let’s talk about how to combat the negatives of Twitter.
First, find a select group of traders that you respect and who trade on the time frame that you trade. Make sure these traders go out of their way to help others, get results and add value.
Next, create a list that allows you to only view tweets from these traders.
Finally, use this list as a learning tool, gathering useful information and disregarding the rest.
Twitter can be a great trading tool if used correctly. Following these three steps will add value to your Twitter experience and possibly even make you a better trader.
P.S. How do you use Twitter?
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I am a huge fan of twitter and I agree with you, is the best place to meet people with similar interests. For example, I am the only person among my ground of close friends who absolutely loves following the stock market (is one of my passions!) hence, twitter has been perfect to find like-minded people I can discuss stocks with. Gotta' love tech.
This is great advice, particularly the part about mixing time frames.