Traders Union research: Investors follow finfluencers and incur losses
Financial influencers have become the main source of investment ideas for retail investors and the primary trigger for real trades. However, their influence often leads to impulsive decisions and losses.
A new Traders Union study, “How Finfluencers Shape Retail Investment Decisions,” highlights the gap between the popularity of these sources and their actual effectiveness.
The report found that 41% of investors name social media as their main source of ideas, ahead of broker analytics (26%) and financial media (18%). At the same time, finfluencers are the most common trigger for real trades, cited by 34% of respondents. Nearly half of participants (49%) admitted they had bought an asset after watching content from online experts.
The study is based on a survey of 1,200 retail investors worldwide. The sample included users of different ages and experience levels who had made independent investment decisions over the past 12 months.
Fast decisions and higher risks
Despite their strong influence, decisions driven by finfluencers are more often associated with risk. Around 37% of investors execute trades within 24 hours of viewing content, while 28% reported losses from such trades.
Risk management is also weaker among these users. About 63% do not consistently use stop-loss orders, and the level of losses and fraud risk among social media users is significantly higher compared to those relying on traditional sources (68% vs 26%).
This suggests that social media acts more as a trigger for action rather than a tool for analysis. Investors tend to react quickly to content without additional verification.
Younger investors at higher risk
The strongest influence of finfluencers is observed among younger users. In the 18–24 age group, this figure reaches 62%, compared to just 21% among investors aged 45 and older.
Experience also reduces reliance on social media. Beginners are more likely to follow influencers due to the simplicity and accessibility of content. As investors gain experience, they shift toward more structured sources of analysis.
Content format also plays a key role. Short-form videos (TikTok, Reels) have the greatest impact, influencing 46% of decisions. They encourage faster and more emotional reactions compared to long-form content or analytical materials.
Social media is reshaping investor behavior
The study confirms a structural shift in the market. Social media is no longer just a source of information — it has become an environment where investment decisions are made.
In this context, speed and accessibility often outweigh the quality of analysis. Finfluencers do not fully replace traditional sources but increasingly serve as the starting point for trades.
As a result, success depends not on access to ideas, but on the investor’s ability to filter, verify, and execute them effectively.
It is worth noting that in a previous study, Traders Union highlighted that while many traders use AI, only a small share actually make profits.
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