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To: Dale Baker who wrote (29285)1/28/2013 4:19:42 PM
From: Sultan  Read Replies (1) of 32936
 
Survey Says: Social Media Has Long Way to Go As Investment Tool

By Steven Russolillo


Social media has garnered a lot of attention as a tool for investors in recent years. A few technologically savvy firms have explored using social media as a sentiment tool, and one man has even launched a Twitter trading platform for the average investor.

But according to a new survey from the Brunswick Group, most investors primarily use the same method as Warren Buffett to make their investing decisions — they go to the company.

Some 57% of nearly 500 institutional investors and sell-side analysts surveyed around the globe selected “information direct from companies” as the source with the most influence on their investment recommendations and decisions, according to the Brunswick data.

About 85% of those surveyed ranked it among the top three most influential sources.

“While investors and analysts are increasingly influenced by digital and social media as the basis for investment decisions, companies and managers should be encouraged that the vast majority look to information direct from companies as the main building blocks of their investment rationales,” says Rachelle Spero, partner at Brunswick.

To be sure, social media isn’t exactly being ignored. Far from it. About 14% of those surveyed included “digital and social media” among their top three most influential sources, up from 6% two years ago when Brunswick previously released this survey. And 86% of investors say digital and social media sources have become more important this year, the survey shows.

But for now, the broad takeaway from Brunswick’s survey is market participants are still more traditional than you might think.

“The centerpiece of the information mosaic continues to rest with companies’ own communications efforts,” Spero says.

blogs.wsj.com
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