AI-Stock Rally Led By Nvidia Corrected By TikTok Finfluencers – Report Shows 64% Accuracy In Predictions But Question Marks Around Reliability Remain Intact

Benzinga and Yahoo Finance LLC may earn commission or revenue for some articles through the links below.

Investing in shares is a serious business that often requires professional advice or thorough research. However, a new trend sees people turning to social media, particularly TikTok, for investment advice from “finfluencers”, raising concerns about the reliability of their advice.

What happened: A report from BestBrokers found that more than 64% of stock predictions made in the top 20 most-viewed stock-picking videos on TikTok in 2023 turned out to be correct, including significant increases in AI stocks like NVIDIA Corp ( NADSAQ :NVDA) and Qualcomm. Inc. (NASDAQ:QCOM).

“Our findings show that more than 64% of the total 87 stock predictions in these videos turned out to be accurate, including notable gains in AI stocks such as Nvidia and Qualcomm,” the BestBrokers report said.

Trending now:

The report found that most influencers recommended top stocks such as Google’s parent company, Alphabet Inc. (NASDAQ:GOOG)(NASDAQ:GOOGL), Nvidia and Amazon.com Inc. (NASDAQ:AMZN), similar to traditional advice from financial experts for low-risk investments.

Experts interviewed by CNBC, such as Gerald Wong of Beansprout and Jeremy Tan of Tiger Fund Management, expressed skepticism about the reliability of these influencers. They noted that the broader US stock market performed well during the study period, which could have influenced the results.

Jiang Zhang of First Plus Asset Management highlighted concerns about the unregulated nature of these influencers and potential conflicts of interest. Despite these caveats, experts acknowledged that influencers are helping to spread financial literacy among younger investors.

Check it out: This billion-dollar fund invested in the next big real estate boom, here’s how you can sign up for $10.
This is a paid advertisement. Please carefully consider the Fundrise Flagship Fund’s investment objectives, risks, fees and expenses before investing. This and other information can be found in fund prospectus. Read them carefully before investing.

The story continues

Why it matters: The rise of financial influencers on platforms like TikTok comes at a time when financial literacy in the US is alarmingly low. A report from the Center of Excellence for Global Financial Education found that the average American scored just 48% on a financial literacy test, with only 16% scoring between 75% and 100% in 2024.

“I advise managers who manage billions on where to invest.”

Get an unfair advantage by getting Matt Maley’s latest trades. Click here to see his top AI stock for 2024.

Personal finance expert Suze Orman also highlighted the issue, estimating that 95 percent of Americans struggle with financial literacy. This lack of knowledge makes the public more susceptible to misinformation and potentially harmful financial advice from unverified sources.

The credibility of finfluencers has also been called into question. In 2023, Indian social media finance personality Ravisutanjani Kumar was criticized for falsifying his educational credentials, casting doubt on the authenticity of many online financial advisors.

Read more:

This article Nvidia-Red AI-Stock Rally was directed by TikTok Finfluencers – Report shows 64% accuracy in predictions, but question marks around reliability remain intact, originally appeared on Benzinga.com