According to a recent study, blogs and social media have become a more important source of information for financial professionals, but subscription syndicated services like Bloomberg and Thomson Reuters still have the biggest impact on investment decisions.

Investment Ideas

A recent study on how investors use of online media authored by Brunswick director Sparky Zivin and partner Jason Golz found that 70% of investors think that digital media is becoming a more important source of investment ideas. The percentage of investors who read blogs for work is up 7% over last year, and the professional use of social networks is up 2%.

Investors following up on tweets and blogs

What’s more striking is that more than half of financial professionals said they follow up on investment ideas from blogs and 27% follow through and have made investments based on those ideas, up from 24% last year and 18% in 2012. Nearly a third have investigated ideas found on microblogging services, and 14% have made investment decisions based on those ideas, up from 12% last year and 4% in 2012.

There is some ambiguity in the data (Twitter is arguably both a social network and a micro-blogging site, so not all of the divisions are clean), but there’s no doubt social media in general is working its way into financials professionals’ daily routines.

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Direct corporate data is still the most important

Even though social media has become more important, it is still the least trusted source of data. Information directly from a company has always had the most influence on investors’ decisions, and the slight uptick this year could be a sign that some investors value the straight facts as a way to cut through the noise online.

There’s a steep drop in impact after direct corporate data, with real-time subscription services rating more highly than sell-side analysts’ research. Primary research ranks surprisingly low on the Brunswick survey, but this could be a result of the fact that not all investors have access to primary research.

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Even though syndicated subscription services are more highly rated, online-only news outlets were rated as the most important source of information by the largest number of investors. In other words, investors who have access to the Bloomberg platform or one of its competitors value that access highly, but many investors are still relying on articles written online. The gap closed by 21% last year, so it may not be long before the respected sources of information online are also the most widely read.

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