Sifting through a wide range of investment ideas and advice on social media can be exhausting and difficult. So, would it be better to look for financial information outside of social networks?
If you tend to check social media to determine your next investment, you should proceed with caution.
The risks of relying on social media for investment advice
Social media platforms provide a place for the public to disseminate information. However, not all the information you see there is provided by reliable sources. Some are only created to manipulate and unfairly take advantage of the trust of their customers.
Cryptocurrencies are popular investments today, although there are many risks associated with investing money in such digital assets. If you bet on them, you either make a quick profit or walk away empty handed.
So, instead of jumping in and buying the crypto that is buzzing on social media, a better option is to review cryptocurrency yourself on reliable websites such as brokerages and financial sites. .
Many brokerage firms and online brokers these days offer investment education services that will help you learn the ropes of buying assets such as currency pairs, stocks, digital coins, and more. Also, the financial information they provide tends to be better than what you can see on social media.
You can also check out some financial websites, where you can find a range of investment information, from market news to simple tips and guides. Another option is to ask a trusted financial advisor to help you adjust your portfolio based on your needs, income, risk appetite and goals.
Doing your own research is crucial
There’s no harm in getting cooking tutorials or food recommendations on social media platforms. But when it comes to your investments, looking outside of social media might be a better idea.
However, that doesn’t mean you can’t get reliable financial advice on social media. You just need to get a second opinion from other reliable resources before making any investment decision.
If you follow a broker or financial advisor on social media, it is essential to check if they are legitimate. Entrusting your investment dollars to the wrong broker or advisor could do enormous damage to your portfolio and your returns.
You can verify the legitimacy of a broker and brokerage firm on the Financial Industry Regulatory Authority (FINRA) website, while you can verify financial advisors on the Securities and Exchange Commission website.
DIY with money you are willing to lose
DIY investing isn’t necessarily a bad thing, as you can learn new things about investing that you didn’t know before and figure out what you do and what you don’t.
If you choose to use a do-it-yourself approach to your investments, even after getting ideas from social media and consulting qualified experts, be sure to only invest the money you are willing to lose. This means separating the money you plan to invest for growth and your long-term goals.