Social Media ‘Financial Gurus’ Are Changing The Finance Landscape, For The Worse

Over the last few years, social media influencers have gained immense prominence as a larger number of users continue joining social media platforms. These influencers create content in the form of photos, and short and long-form videos, usually focusing on a particular topic.

For instance, some influencers focus on wellness, while others focus on fitness, art, politics, education, etc. Others remain loyal to the trends, changing their focus area with the newest trends. Influencers, like all celebrities, use their connection with their audiences to sell products by various brands. The brand advertisements are integrated into the content produced by these influencers.

Over the last few years, high returns from financial assets attracted a large number of investors into the financial markets. Google Trends shows a 20 times increase in searches for the word “crypto” between September 2020 and November 2021. The keyword “stocks” has a much lower increase of 2.5 times, over the same time period.

The increase in retail interest in the markets gave a boost to businesses whose investment products were primarily aimed at retail investors. These businesses, often dealing in crypto-related products, mutual funds, or stocks, hired influencers to advertise their investment products. But ultimately, influencer marketing appears to have resulted in multiple cases of mis-selling, a major issue in the financial services industry.

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