The world is becoming more social. The internet is allowing us to connect in new and exciting ways. Social media is fast growing and becoming a powerful marketing tool. However, that’s just one aspect of how the social internet is improving our lives. These days social networking and social media is also being used in new and unique ways as an investing tool.
Social networks allow us to utilize the experience and power of a community. This community can be a powerful tool. Are you looking to get more information on a stock? Or do you need funding to create a new product? Perhaps you wish to invest directly in people? Or lean on the experience of a savvy currency trader? Social Networking provides new and exciting tools to help you in all these different ways.
Social Investing is a Powerful Tool
Take a look at something as simple as picking a stock. Social Picks is a social network for picking a stock that is gearing up for a relaunch. A social networking site like this will allow for people to follow the stock picks of the community and hopefully lead to better investments overall.
Imagine having an entire community of analysts and financial specialists as well as informed laymen all discussing stocks. Analyzing the ins and outs of a particular company in a group to pick the best investments. The community can direct each other and inform each other of the best picks and discuss their methods.
Social Lending
Beyond traditional stock picks, I’ve made no secret that I am personally a fan of social lending. This is the type of investing where lenders and borrowers are part of a community and can invest in each other. I’ve been getting great returns from social lending through Lendingclub. Here’s a screenshot of my recent returns:
One of the things that I love about Lendingclub (besides the awesome returns) is that I can get a glimpse of the borrower’s personality and likelihood of repaying the loan based on their answers to lender questions. Seeing a brief conversation between the lender and borrower gives me a lot of insight into my investment. This is information that is beyond mere numbers. I can see whether the person is serious about the loan or whether they appear to be nonchalant about the money they are being lent.
To me this kind of interaction is extremely informative and gives me tremendous insight into my social loan that I wouldn’t get in a traditional investment. If I invested in a stock, I can see that companies financials. But I wouldn’t normally get an interview with the CEO to ask them what they plan to do with my investment.
It’s this kind of interaction that I love about social lending and why I personally recommend investing in social lending through Lendingclub.
How About Social Currency Trading?
Currency trading is fast paced and volatile. Plus it takes a great deal of insight and knowledge into world events. It’s hard to learn and difficult to excel in this type of investment. Still, many people are lured into currency trading because of the potential for high returns. It’s a high risk, high reward investment.
But what if you could utilize the skill and knowledge of other experienced traders? What if you could instantaneously follow the trading styles of the gurus?
Could you imagine this in the stock market world? If you could hit a button and instantly copy all of the trades of Warren Buffet, would you?
I found a tool that allows you to do exactly this in forex trading. eToro has this awesome tool called copy trader that allows you to follow the gurus in forex trading. Not only that, but they give you a free practice account so that you can feel comfortable learning about trading currency.
Their social platform allows you to actively participate and discuss the latest currency trends. Take a look at what it looks like below:
I’ve been using their copy trader system with a practice account to learn the ropes. So far, my practice account has seen over 10% gain.
I started with $10,000 total. As you can see, I have 9,633 invested, but I also have $1,963.18 left in my account balance. So, my total gain is just about $1600. Not bad for a forex noob.
While, I’m still in the learning stages and using a practice account, I love this system of learning and investing. I’m quite impressed with eToro and I think it’s well worth trying out their system with a practice account.
What if You are an Entrepreneur or Inventor?
This is a great time to be an entrepreneur or inventor. If you need funding for a project, you don’t need to go out and pitch angel investors. You can simply start a kickstarter project.
Kickstarter allows you to follow and fund projects as a community. You can either start your own project or invest in someone else.
Some mainstream entrepreneurs are seeing the advantages of seeking funding on kickstarter and we’ve been seeing some huge projects and revenues. You can find some awesome crowdfunded projects on kickstarter these days.
How About Small Projects
I love the world’s smallest marketplace, fiverr. While many may think of this as just another small marketplace, I think that one of the things that drives fiverr is that it also has a social component.
Each seller has a profile of their projects that you can view and rate. You can share popular projects with others and leave your own feedback on gigs that you’ve purchased.
One of the best indicators of a good gig is through reading the feedback. I rarely purchase a gig with no feedback. I like to read what the other people say about a gig and I also like looking at the profile of the person selling the gig to see how they rate overall.
If you have a small project and don’t need to go the route of crowdfunding, then you can sell your project in small $5 increments on fiverr.
Final Thoughts
These are just a few ways that you can use the social platform to invest and make money. Social networking is providing awesome tools in every aspect of daily life, including finding new investment opportunities. I think it’s time to branch out and diversify your portfolio and see how social can help you make more money.
Richard is a full time professional, husband, father and blogger juggling all the responsibilities of life and running a blog. Richard enjoys writing about life and online money matters.
Wow Richard, I had no idea about some of these other sites or services. I’m not into investing, stocks, funding, etc. I claim to be pretty ignorant in a lot of those specific areas. Now Fiverr I am aware of and have used people’s services there for projects I needed done and didn’t know how to do myself. But I know you’re suggesting it for different uses.
@AdrienneSmith I just love that there are so many social tools out there now to help people with all sorts of personal finance. Fiverr is great if you have a small gig to offer. I see people offer gigs all the time that is automated by software, so it takes very little time, or they sell an info product such as an e-book as a gig. It seems like an awesome way to make a little extra cash.
That is an awesome post. I have always enjoyed investing…but been a little hesitant about the whole lending thing.
I love social lending. I feel like I have the opportunity to make money the same way that banks do by lending to people. Also, the minimum investment is low so I’m not risking a lot of money. And I feel like I get a lot of information simply by seeing the way people answer the questions, which often is more informative than the answer itself.