Twitter's eToro Deal Enables Stock Trading on Platform

What happened

Twitter has teamed up with trading platform eToro Brokerage to give users real-time data and allow them to buy and sell assets from the platform. People will be able to trade stocks, commodities, and crypto via Twitter's $Cashtag search function, per today's press release from eToro Brokerage. The move is one of many shake ups since Elon Musk acquired Twitter in October last year.

Apply now to open an eToro Brokerage account!

So what

The eToro Brokerage-Twitter team up plays into a growing crossover between financial advice and social media. According to a Forbes survey, almost 80% of millennials and Generation Zers have received investment advice on social media. Twitter owner Musk told a Morgan Stanley conference in March that he thought Twitter could become the biggest financial institution in the world.

eToro Brokerage boasts a copy trading feature and a news feed where investors can post updates and share comments. Yoni Assia, CEO and Co-Founder of eToro, said, "There is power in shared knowledge and by transforming investing into a group endeavour, we can yield better results and become more successful, together."

Now what

It's worth noting that you won't actually be able to buy or sell assets directly on Twitter. The deal between the two companies means you'll click through to eToro's app where you can trade or set up an account if you don't have one. More widely, it's worth considering whether trading stocks via social media makes sense for you as an investor.

In terms of investment decisions, social media can make a good starting point. But only you know your financial situation, your investment strategies, and your tolerance for risk. If you're tempted to invest in a stock based on social media advice, try to also do your own research and consider how that asset fits into your wider portfolio.

Here at Motley Fool Money, we advocate a long-term buy-and-hold approach to investing. Over time, this can generate better rewards than short term trading. The idea of buying a quality asset and holding it for five years can be at odds with the quick trading decisions encouraged by people's Twitter feeds. Take your time and don't allow social media furore to push you into panic buy or sell decisions.

Also, bear in mind that financial advice on social media may not be 100% reliable. In addition to the risk of falling for spoof accounts, we've seen some cases where celebrities have shilled investments without necessarily revealing the post was paid for. Think carefully about who you are getting advice from, what their motivation is, and what experience they have.

Finally, rather than using eToro Brokerage simply because it's connected to Twitter, shop around to find the right brokerage account for you. eToro has several advantages, but there are a host of top online brokers that may offer lower fees, a wider range of available assets, or access to more research.