As part of our masterclass which took place in March 2022, we organised a roundtable with some high profile financial influencers, or ‘finfluencers’, including Poku Banks, Timothy Paul (aka tempahtime), and Annika (aka Finpact) and led by Caroline (aka Trading Angel) to discuss social investing.
We’re delighted to present the entire video segment below to help you learn of both the positives and potential dangers of social investing from experts in this field.
One of the first talking points was regarding the best piece of advice they received when starting their investment journey:
1. Understand that losses are normal
Answering first, Poku said that what helped him at the beginning was understanding that losses are part of the game. He continued, “So, when I was told earlier on my journey that losses are part of the game, it builds your wisdom, and you learn from your mistakes and you’ll refine your skill, you’re refining your strategy.”
2. Have a longer time horizon
Annika said, “One of the best pieces of advice I was given was having a longer time horizon, so having your portfolio of short-term trades, but also having long-term trades and not panicking when you see market volatility.”
3. Don’t rush the process
Timothy explained that it’s all about not rushing the process, realising that it is a journey, and trying not to get caught up in comparisons: “I think that really focusing on you and how you can progress and just compare yourself to where you were a month ago, six months ago, a year ago, and how far you’ve come since then. […] So, I think that it’s key to just kind of keep focused on what you’re trying to achieve and your own progress that you make.”
Following on from this, what do they think are the top mistakes that traders make when they first start?
1. Not figuring out your time horizon
Similar to the best piece of advice she received, Annika feels like beginner traders need to figure out their time horizon and tailor their strategy depending on their trades as not every project will be a long-term investment.
2. Copying other signals and investment ideas on social media
Poku touched on the fact that beginner traders blindly copy other signals or other investment ideas on social media which doesn’t work as everyone has different pockets and different trading accounts: “I feel like you have to understand that everyone’s in different stages in their investing career and you have to apply that and compare to your own strategy and how you want to do things.”
Copying signals is something that Caroline also agreed on as she said she receives messages from people asking her to trade on their behalf or send them signals which is information people should have for themselves, and not just copy or rely on others.
3. Chasing money rather than gaining skills or knowledge
On a similar wavelength, the biggest mistake in Timothy’s opinion is that people get into the industry and chase the money rather than the skills or knowledge. Beginners especially don’t necessarily have the money to waste on bad investments and you need to focus on the fundamentals of what you need to learn and do research before investing.
Part of the discussion delved into whether, as financial creators themselves, they feel they have some sort of responsibility due to the sort of content they post, particularly their lifestyle.
All agreed that there is a level of responsibility as people trust and look up to these financial creators, but that it’s about being honest and building a relationship with followers from that.
Timothy recommended not following those who only show the wins, the flashiness, and the upsides, as there are always downsides too. Interestingly, Annika touched on the fact that she is hesitant to show off her lifestyle as a woman in the industry as she already gets judged, something which Caroline also agreed with.
But what do they think of the future of investing and how do they think the landscape of investing has changed due to social media?
Poku described the future landscape as potentially becoming some sort of a ‘big minefield’ due to the number of opportunities available such as NFTs, cryptos, and other investment vehicles, which he explains could become problematic as the younger generation tend to follow wherever the hype is.
As the roundtable came to a close, Caroline summed up the main talking points of the roundtable into an acronym of TRADE:
T – Testimonials, is a person backed up?
R – Realistic, is what they’re proposing or offering realistic?
A – Accreditation, where did they learn about finance?
D – Due diligence, have you done your due diligence to check out who they are?
E – Educate, educate yourself about the tell-tale signs.
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