If there is a trading event that the global financial market remembers as a pivotal moment, it's the GameStop short squeeze in 2021. The short squeeze was the stuff of Hollywood drama, with the media labeling it as an epic David versus Goliath story.
An unknown data analyst created a concept paper for the short squeeze and shared it with members of the WallStreetBets subreddit. Within a short time, many retail investors swarmed the stock market and inflicted billions of dollars in losses on established hedge funds.
The short-squeeze saga illustrates the power of influencers, proving that a well-placed sentence or shared investing information has the ability to move mountains and markets alike.
What is Retail Investing?
Retail trading or retail investing refers to the activity of individual investors in the financial market. The financial and stock market is huge, and participants number in the hundreds of millions. Each participant is looking for an opportunity to buy or sell securities with the ultimate goal of making a profit.
The opposite side of retail trading is institutional trading. Retail traders differ from institutional traders based on their goals and the kinds of trades they make. Usually, retail traders are nonprofessionals. They make small trades through personal accounts registered with brokers.
Institutional investors make large-scale trades, often valued in millions to billions per trade. Institutional trading entails managing the portfolios of other investors. An example of an institutional trading entity is a mutual fund.
Before the digitization of the financial markets, institutional investors had a clear edge over retail investors. However, the edge started to dissipate with the appearance of online trading brokerages. Also, today’s retail investor understands the vicissitudes of investing, thanks in part to the knowledge acquired from retail investing influencers.
Best Investing Influencers Right Now
These are the movers and shakers riding the waves of market trends and dictating them with their trading habits and social media posts.
Mark Cuban
Mark Cuban is not what we could refer to as a retail investor because the man is a billionaire. Cuban is popular for being the owner of a basketball team but more so for being easy with sharing a piece of his mind.
He is also a cast member of ABC’s Shark Tank television show, where he shares investment advice. Cuban is on board the cryptocurrency train, a fact he makes clear when he appears on top crypto podcasts in the United States.
Keith Gill
Keith Gill is a financial analyst who runs a YouTube channel under the name Roaring Kitty and was a little-known Redditor until the GameStop short squeeze. Gill is a self-confessed value investor. He referred to principles of value investing in his thesis for the GameStop short squeeze.
Elon Musk
Elon Musk, self-described as the "Technoking of Tesla, Imperator of Mars," reigns supreme in the world of Financial Twitter (FinTwit), which now goes by X. Boasting over 153 million followers, Musk has established himself as a leading voice in retail investing and cryptocurrency. His influence extends far beyond traditional markets; he's a luminary whose commentary shapes the financial landscape in real time.
A post from Musk can send shockwaves through the crypto world, significantly affecting the value of assets like Dogecoin, his often-touted favorite. Beyond his social media prowess, Musk is an astute investor with a proven track record. He parlayed the proceeds from the sale of PayPal into a multi-billion-dollar empire that includes Tesla, SpaceX, X (formerly Twitter) and other high-profile ventures. For traders, keeping an eye on Musk's moves and musings can offer invaluable insights and potential opportunities in the ever-evolving financial markets.
Timothy Sykes
Timothy Sykes is a modern-day success story in the world of retail investing. He is popular for amassing $7.07 million from day trading while in college, using an initial capital investment of $12,415.
Sykes runs one of the best penny stock blogs in the world and is a frequent face on major U.S. TV channels where he explains the best strategies for trading penny stocks.
Investing Influencers Who Paved the Way
There's a saying that you can't teach an old dog new tricks. Conversely, you can't teach the tricks — and deep know-how — that comes from years of success, failures and experiences. These investing influencers got the ball rolling and carved out a path for retail investors today.
Warren Buffett
Buffett is a legendary investor and a member of the billionaire club. He has been in the game since the 1950s, and he is an ardent supporter of the value investing strategy.
Buffett continues to inspire millions of retail investors today. Buffett helms Berkshire Hathaway.
Ray Dalio
Ray Dalio is a successful fund manager who is part of the past and the present of the investment community. Dalio started Bridgewater Associates in 1971 and still runs it today. Bridgewater is a pioneer in the hedge fund segment. His hedge fund is the second largest in the world based on assets under management. Dalio also is known for pioneering unique principles for success in business and life.
Benjamin Graham
Benjamin Graham is the precursor to the Buffetts of the world. Graham takes much of the credit for developing the principles of value investing. He was a prolific writer who created invaluable manuals offering guidance in intelligent investing. Graham took huge risks in the stock market during his prime and earned lots of money from the investments.
George Soros
George Soros is famous for shorting the British pound in 1992 and earning him profits close to $2 billion. Soros founded and successfully ran Quantum Fund, a hedge fund. Despite his long line of successful trades, little is known about Soros’s investment principles.
Most of the ideas he shares are commentaries on macroeconomic issues. Soros has a keen eye for profit opportunities, and some call him the Michael Burry of the olden days.
Investing Influencers Shaping the Future
As retail trading increases in popularity and Reddit communities topple hedge funds, new voices and faces continue to emerge as thought leaders in the investing space. These investing influencers are shaping the way of tomorrow.
Chamath Palihapitiya
Welcome to the venture capital era. Chamath Palihapitiya is part of the new crop of investors building wealth by investing in early-stage private companies. Palihapitiya is also a prominent finance influencer who does not shy away from airing his opinion on X.
During the GameStop drama, Chamath sent out thousands of tweets supporting the Reddit gang. He is part of the investing community using special-purpose acquisition companies (SPACs) to unlock new investment opportunities.
Raoul Pal
Investing influencer Raoul Pal is a driving force in shaping the financial landscape, renowned for his exceptional macroeconomic insights and sharp focus on cryptocurrency, fintech and blockchain technologies. With an unparalleled ability to decipher complex economic trends, Pal guides investors through intricate market dynamics, offering strategic perspectives that empower decision-making in a rapidly evolving world.
Pal's emphasis on cryptocurrencies and blockchain's transformative potential sets him apart. His analyses consistently explore the intersection of traditional finance with these emerging technologies, spotlighting their impact on investment strategies and global financial systems. By bridging the gap between macroeconomics and crypto, Pal is not only shaping the future but also equipping investors with the knowledge needed to navigate the complexities of modern finance.
Josh Brown
Josh Brown is the chief executive of Ritholtz Wealth Management. He runs a blog called Reformed Broker, contributes to CNBC and authors columns in various reputable publications.
As an influencer, Brown regularly updates his more than 1 million X followers about the latest developments in the financial markets. Most of the information he shares centers on guiding readers on their investment journeys.
Errol Coleman
His peers call him the TikTok trader because Errol Coleman is a day trader who shares educational videos on his TikTok channel. He has a substantial YouTube following for his channel that explains things such as exchange-traded funds (ETFs).
Although Coleman is fresh out of college and still young, thousands of people regularly tune in to get a piece of his advice and insight on a regular basis.
Ben Pryor
Ben Pryor is a 25-year-old trader who is part of the Robinhood crowd. Robinhood is an online retail trading platform and the stage on which the GameStop saga played out.
Like investors of his generation, Pryor is almost always on social media. He spends most of the time explaining stocks and other financial instruments to his followers. Pryor has a huge following on TikTok and Discord, where viewers tune in regularly to hear what he has to say.
How to Choose Investing Influencers to Follow
Millions of investors participate in the global financial market, but only a few stand out. Successful investors often have followers because people want to know the secret sauce.
To be this successful, you need to have an understanding of the market and the ability to use social media to reach people. Knowledge acquisition is necessary to ensure that you are a step ahead of the market. Social media platforms such as X make news consumption easy and fast. But you can’t rely entirely on social media because there is too much noise.
Successful investors have a clear understanding of what it is they want. Setting clear goals ensures clarity of thought, which fosters productivity. Most finance influencers demonstrate this concept.
Warren Buffett, Benjamin Graham and Keith Gill have one thing in common. They know how to communicate their ideas. Gill was able to convince thousands of Redditors to buy GameStop stock, hence pulling off an epic short squeeze. Type into your browser a search term for investing quotes, and you will not miss words of wisdom by Buffett or Graham.
Investing Influencers Now, Then and in the Future
The amount of investment advice floating around on social media sites today threatens the position of established investment advisory firms. Retail investing influencers create a community of like-minded investors around them, and their followers are plentiful.
The possibility of investors relying entirely on social media for all their investment needs in the future is real. Check out more of our investing content to learn how to invest and where to buy stocks.
Frequently Asked Questions
How to vet personal finance influencers?
To vet personal finance influencers, you should research their background and credentials, evaluate their content and advice, consider their transparency and authenticity and assess their engagement with their audience. This process will help ensure that you are following someone who is trustworthy and credible in the field of personal finance.
How do you become a personal finance influencer?
Becoming a personal finance influencer requires expertise, authenticity and effective communication. Build credibility through a deep understanding of financial principles and share valuable content through various platforms. Foster a genuine connection with your audience by being transparent and relatable. Engage with followers and tailor advice to their needs to gain a loyal following and position yourself as a trusted source of financial guidance.
Is it legal to give financial advice on social media?
Giving financial advice on social media is legal, but it is important to be accurate and comply with laws and regulations. It is recommended to have knowledge of the financial industry, licensing requirements and disclose any conflicts of interest. It is also advisable to consult with a legal professional or financial adviser to ensure compliance.