Social Media as an Information Source in Finance: Evidence from the Community of Financial Market Professionals in Poland

Abstract

Social media has become a source of information for individuals making decisions in financial institutions worldwide. As a part of Business Intelligence systems, platforms such as Facebook, Twitter, or LinkedIn provide financial market professionals with a magnitude of market data-for example, stock price expectations, customer insights, and market sentiment. Based on 415 survey responses of financial market professionals in Poland (purposive sample), this study examines factors behind social media usage in financial institutions. We found that decision-makers representing these institutions seldom use social media for job-related purposes. However, the professionals from institutions that manage more diversified asset portfolios and hold the most risky assets in the portfolios, are more likely to use social media for information purposes. We also found that the value of assets does not affect the use of social media for information purposes among financial market professionals in Poland. This implies that representatives of certain types of financial institutions are more inclined to use social media for professional purposes. Our study offers an insight into the variables that best explain the decision to monitor social media content by financial market professionals. Thus, it can provide a basis of recommendations aiming to enhance the market for business information.

Semantic Analysis: Can MD&A Word Choice Increase Stock Price of American Publicly Traded Banks Disseminating Using Twitter?

“…Word strength or "power" is established by assigning a numerical value (Thelwall et al, 2010). The effectiveness of semantics is based on how well the sender and receiver agree on the strength of the word (Ogneva, 2010 With advancing technology, social media has become a source of information for individuals making decisions on financial institutions (Cwynar et al, 2019). Only recently has semantics been considered a mainstream movement.…”

Measuring aggressive decision-making behavior: A confirmatory factor analysis

“…The role of information in decision-making is of paramount importance in this study. Various sources of information serve as references in investor decision-making, including fundamental information, technical information, market maker information (known as "bandarmology" information among Indonesian investors), and information provided by social media influencers (Cwynar, Cwynar, Pater, & Filipek, 2019;Filbert, 2016;Karo-karo, 2017;Listyorini, 2020;Nuzula, Sisbintari, & Handayani, 2019).…”

Information Sources for Investment Decisions: Evidence from Japanese Investors

“…Khan et al (2020) analyzed the relationship between demographic and social parameters and the use of social media in financial decision making and found that cohort generation and occupation were significantly and favorably associated with the use of social media. Similarly, Cwynar et al (2019) examined the factors influencing the use of social media as an information source in finance in Poland and found that people with more diversified asset portfolios and those who hold the riskiest assets are more likely to use social media for information purposes.…”

“…First, sample selection and omitted variable bias are concerns. For example, Khan et al (2020) and Cwynar et al (2019) focused mainly on a specific area or small institutions, with limited use of important explanatory variables, thus questioning the representativeness and precision of the sample. Second, several studies suffer from a limited sample size bias.…”