<abstract xmlns="http://www.w3.org/1999/xhtml"><bold>Background and Purpose</bold>: In recent years classic financial market theory based on decision makers’ rationality has been challenged by repeated anomalies that became a ‘new normal’. As a result, what we witness today is a considerable turn to behavioral concepts that can shed a new light on choices made by market participants. The astonishing development of social media accelerated scientific validation of such concepts, since the media opened new and capacious ‘laboratory space’ for testing behavioral hypotheses. The main purpose of the article is to examine whether financial market professionals believe that social media content can be useful in achieving additional financial market returns and to investigate the factors behind this belief.<bold>Design/Methodology/Approach</bold>: We surveyed a sample of over 400 financial market professionals at institutions operating in Poland, and analyzed the results using logit regression models.<bold>Results</bold>: We established that almost 60% of the surveyed finance professionals recognized the potential of social media for achieving additional returns. We also found out that the differences in respondents’ perception of this potential could be explained mainly by heterogeneity of their job experience and, to a lesser degree, by their job position. Interestingly, more experienced individuals were less likely to recognize this potential. Firm-specific factors did not have a significant effect on the dependent variable.<bold>Conclusion</bold>: The opinions of financial market professionals regarding the link between social media and additional returns are mixed, which is consistent with the current body of evidence brought by sentiment-based research. Our findings confirm the key role of previous experience in explaining attitudes towards novelties and innovations (such as social media), a phenomenon known from other fields and everyday experience.</abstract>

Background and Purpose: In recent years classic financial market theory based on decision makers’ rationality has been challenged by repeated anomalies that became a ‘new normal’. As a result, what we witness today is a considerable turn to behavioral concepts that can shed a new light on choices made by market participants. The astonishing development of social media accelerated scientific validation of such concepts, since the media opened new and capacious ‘laboratory space’ for testing behavioral hypotheses. The main purpose of the article is to examine whether financial market professionals believe that social media content can be useful in achieving additional financial market returns and to investigate the factors behind this belief.Design/Methodology/Approach: We surveyed a sample of over 400 financial market professionals at institutions operating in Poland, and analyzed the results using logit regression models.Results: We established that almost 60% of the surveyed finance professionals recognized the potential of social media for achieving additional returns. We also found out that the differences in respondents’ perception of this potential could be explained mainly by heterogeneity of their job experience and, to a lesser degree, by their job position. Interestingly, more experienced individuals were less likely to recognize this potential. Firm-specific factors did not have a significant effect on the dependent variable.Conclusion: The opinions of financial market professionals regarding the link between social media and additional returns are mixed, which is consistent with the current body of evidence brought by sentiment-based research. Our findings confirm the key role of previous experience in explaining attitudes towards novelties and innovations (such as social media), a phenomenon known from other fields and everyday experience.

Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

University of Information Technology and Management

Organizacija

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Background and Purpose: In recent years classic financial market theory based on decision makers’ rationality has been challenged by repeated anomalies that...

Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Published Online: Jun 12, 2017

Page range: 97 - 111

Received: Jan 21, 2017

Accepted: Apr 28, 2017

DOI: https://doi.org/10.1515/orga-2017-0007

Keywords
social media, sentiment, behavioral finance, financial market professionals, financial market returns

© 2017 Andrzej Cwynar et al., published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Can Social Media Content Increase Financial Market Returns? Survey Results from Poland

Published Online: Jun 12, 2017

Page range: 97 - 111

Received: Jan 21, 2017

Accepted: Apr 28, 2017

DOI: https://doi.org/10.1515/orga-2017-0007

Keywordssocial media, sentiment, behavioral finance, financial market professionals, financial market returns

© 2017 Andrzej Cwynar et al., published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
social media, sentiment, behavioral finance, financial market professionals, financial market returns