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Happy Tuesday,

In this newsletter, I’m going to break down one of my tweets that seemed to resonate with a lot of people.

If you have been following me on my Twitter / Instagram over the past year I have stated countless amount of times how powerful it is to be on Twitter if you’re an avid investor in stocks, crypto, NFTs, or all of the above. A classic example is the countless tweets by everyone's favorite Twitter market manipulating superstar Elon Musk, but first, we have to answer…

What is a Bloomberg Terminal?

The Bloomberg terminal was released in 1982 by Michael Bloomberg shortly after his departure from Salomon Brothers. At this time computers were rare - and even rarer was financial data from companies and market news in one location. There was no Google or online website that you could just look up the revenue for a company with a couple of clicks of the mouse.

The Bloomberg terminal is a platform that aggregated vast amounts of financial data all around the world whether it be about stock, bonds, real estate, bonds, forex, repo rates, etc. - you name it, Bloomberg Terminals have it.

Naturally, the terminal was a massive success and as of 2016, there were over 325,000 Bloomberg Terminal subscribers worldwide. Pretty remarkable considering it is available for an annual fee of $20,000 per user. Needless to say, if you are a professional trader for a fund it is hard to go without. If you are interested, below is an excellent intro video covering what the Bloomberg Terminal is like today.

Today’s Bloomberg Terminals are so advanced that there are integrations in which you can look up fine dining restaurants in your area, a “craigslist” for high net worth individuals, sports betting, and much more. Here’s a list of 12 awesome things you can do on a Bloomberg Terminal.

What does Twitter have to do with a Bloomberg Terminal?

In many ways, Twitter can act as a mini Bloomberg Terminal. On Twitter I follow long-term investors, day traders, volatility traders, value investors, growth investors, bond experts, finance media companies, startups, CEOs, brands, and many more. At the touch of my fingertips, I can see updates, posts, and analyses from all of these accounts. Oftentimes big finance media companies like CNBC and others talk about things that were already shared and explained on Finance Twitter either many hours after or even a day after they are discussed on Twitter.

Something that astounds me about Finance Twitter is the wealth of knowledge from seemingly unassuming people. A key thing to note: Follower count ≠ experience in the market. Sometimes people with a couple of hundred followers in my DMs have helped me with the most complex investment strategies that you would only know if you are an experienced hedge fund analyst or professional equities trader. Speaking of hedge funds, when you work at most financial institutions they have strict social media policies in which you can’t post anything that is remotely about the markets. To curb this, a lot of traders create anonymous accounts. So the beauty of Twitter lies in the fact that the guy with a profile picture of Daffy Duck talking about credit default swaps could very well be a senior manager at Goldman. It sounds crazy but this type of stuff is rampant.

Speed is key: Things that happen on Twitter happen FAST and often happen in real-time. For instance, most people on Twitter are the first to hear of a celebrity’s unfortunate passing well before the media companies and tabloids get to it. This is a double-edged sword because when the consumer is the “vetter” of news then misleading or false news can be spread like wildfire in an instant. It is very important to follow the right people and over time you will have a list that you know double checks before they post.

My main point: I don’t have $20,000 burning a hole in my pocket waiting to use a Bloomberg Terminal for one year. Instead, I get my finance news predominately through Twitter. By following the right people I can know that most of the information I see regarding a company is reasonably reliable and something that I wish to be informed about. I have yet to be on Twitter for a good part of the day to then click on CNBC and see them talking about something I haven’t already heard. Why? THE PANEL IS ON TWITTER LOL. They are just regurgitating what everyone else saw as it happened.

Trust me, as you will learn below it can pay to be on Twitter and follow (or have alerts on) for the right people.

Elon Moves Markets

In college when I was a self-proclaimed day trader, Tesla was an absolute rollercoaster stock to trade. Below you will see the wild ride from September 2015 to September 2019 (5 to 1 split-adjusted). Elon loved to tweet (and still does) and was likely the cause of the many price spikes you see on the chart. At the time, I remember a lot of people’s investment thesis was to just send a buy order the second Elon tweeted anything remotely bullish about Tesla.

One of the clearest examples of how much people feed off of Elon’s tweets was during the take Tesla private fiasco. I’ll let his tweet do the talking.

The day before the stock was hovering around $340 and immediately after this tweet, it rocketed to $420 in a blink of an eye. I won’t lie I vividly remember being in my college dorm seeing this tweet go out and frantically dumping positions in my portfolio to buy Tesla stock. I mean who wouldn't if you knew the game that Elon was playing? Months after when the dust settled he was slapped on the wrist with a $40 million fine by the SEC. Comical at best.

But wait, there’s more…

Here’s just a few more of the many examples of Elon moving the markets with only his thumbs and a virtual qwerty Apple keyboard.

• Musk tweeted in 2019 “Spooling up production line rapidly. Hoping to manufacture ~1000 solar roofs/week by end of this year” when asked about Tesla’s plan for a solar roof tile. $TSLA shares shot up 3%. Have yet to see any of the words in this tweet come true years even years later.

• Musk infamously tweeted in May of 2020 “Tesla stock price too high imo”. As you can imagine this sent Tesla shares tumbling 10%!

• (so many examples I can’t keep track of) Musk moves the price of the altcoin cryptocurrency Dogecoin through an onslaught of tweets while also dunking on Bitcoin’s price. More on that here.

I could go on with more examples but these three are the most egregious examples of how billions of dollars of Tesla market cap can be moved by a single man and a Twitter account.

Elon’s tweets are cookie-cutter examples of how quickly a tweet can translate into reality. Twitter reports about the markets and the markets can move off of Twitter. It isn’t a perfect relationship but you will over time how closely connected they truly are.

Elon isn’t the only one that moves markets with tweets (Trump was another major example) and community sentiment alone can be a big mover especially if it is around a low float stock.

Low float stock: A stock that has a smaller amount of shares available for the general public to trade therefore it can be much more susceptible to volatility and movement by retail traders.

At the end of the day, I would love to get my news from people I follow - with their own takes and biases rather than I person in a suit on screen making me fall asleep in my chair. Finance Twitter isn’t just entertaining, in my opinion, it’s a tool that can help you immensely in your due diligence and decision making when it comes to investments. The more data and information that you take in the more informed you can be!

Have a great weekend! See you for Friday’s newsletter!

I know I put this at the bottom of a lot of my emails… but if you just share this with a friend that is curious that would mean the world to me!

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