Endnotes

1 The views and opinions made in this report are those of the authors, and do not represent official views or policies of FINRA. This report does not express any official FINRA legal position and does not create any new regulatory requirements or suggest any change in any existing regulatory obligations, nor does it provide relief from any existing regulatory obligations. This report summarizes key findings from FINRA’s outreach and research on the potential impact of social media influenced investing, in the financial services industry, and does not endorse or validate the use or effectiveness of any of these applications. While this report highlights certain regulatory areas that FINRA members may wish to consider, it does not cover all applicable regulatory requirements or considerations. FINRA encourages all member firms to conduct a comprehensive review of all applicable securities laws, rules and regulations to determine potential implications including any regulatory implications of social media-influenced investing.

2 FINRA Investor Education Foundation, What Matters to Consumers When Assessing Information for Financial Decision-Making? (Sept. 2025).

3 Id. The Federal Reserve Bank of Philadelphia found that 38 percent of 18 – 35-year-olds rely on social media for financial news (compared to only 4.5 percent of those 56 and older) on platforms including YouTube, Facebook, Instagram, TikTok and X (formerly Twitter). Tom Akana, Amber Lee and Larry Santucci, How Americans Use Social Media for Financial Advice, Federal Reserve Bank of Philadelphia (Mar. 2025).

4 See Request for Comments section of this paper.

5 See, e.g., Ontario Securities Commission, Social Media and Retail Investing: The Rise of Finfluencers (2025); Elana Duré, Social Media’s Influence on the Investing Community, JP Morgan Wealth Management (Jan. 7, 2025); FINRA Investor Education Foundation, Investors in the United States: The Changing Landscape: A Report of the FINRA Foundation National Financial Capability Study (Dec. 2022); FINRA Investor Education Foundation, What Matters to Consumers When Assessing Information for Financial Decision-Making? (Sept. 2025); Aru Bhat, Sofia Eckrich,Are 'Finfluencers' the Future of Financial Advice? (July 17, 2024); Tom Akana et al. How Americans Use Social Media for Financial Advice, Federal Reserve Bank of Philadelphia (Mar. 25, 2025).

6 Antonio Desiderio et al., The Dynamics of the Reddit Collective Action Leading to the Gamestop Short Squeeze, Nature (Feb. 3, 2025).

7 Meme stocks is a term that is generally used to refer to stocks that gain popularity primarily based on social media sentiment. See also, J. Anthony Cookson et al., The Social Signal, Journal of Financial Economics (Oct. 21, 2022).

8 FINRA, Podcast, Finfluencers: New Marketing Strategies Meet Existing Compliance Obligations (June 25, 2024); CFA Institute Research & Policy Center, The Finfluencer Appeal: Investing in the Age of Social Media (2024); International Organization of Securities Commissions (IOSCO), Finfluencers: Consultation Report (Nov. 2024).

9 FINRA Social Media Summit, Nov. 14, 2024; Rongjuan Chen et al., The Relationship Between Twitter Sentiment and Stock Performance: A Decision Tree Approach, Proceedings of the 56th Hawaii International Conference on System Sciences (2023).

10 Daniel Liberto, Social Sentiment Indicator: What It Is, How It Works, Investopedia (Nov. 1, 2022).

11 Some broker-dealers have developed opportunities for investors to communicate with each other about investment ideas within their own platforms. See, e.g., Interactive Brokers, IBKR Forum: Join the Conversation; Webull, Join Webull In-App Community!.

12 The Board of the International Organization of Securities Commissions (IOSCO), Online Imitative Trading Practices: Copy Trading, Mirror Trading, Social Trading, IOSCO Consultation Report (Nov. 2024). Copy trading can take different forms and may involve the payment of fees for access to strategies and automation of trades in more structured forms. The SEC has stated that “[c]opy trading in securities may raise regulatory concerns under the U.S. federal securities laws, including potential broker-dealer and investment adviser status issues.” See Request for Information and Comments on Broker-Dealer and Investment Adviser Digital Engagement Practices, Related Tools and Methods, and Regulatory Considerations and Potential Approaches; Information and Comments on Investment Adviser Use of Technology To Develop and Provide Investment Advice, Federal Register Release Nos. 34-92766 (2021); Dhruv Aggarwal et al., The Meme Stock Frenzy: Origins and Implications, Southern California Law Review (April 2024).

13 FINRA, Investor Bulletin: Social Sentiment Investing Tools – Think Twice Before Trading Based on Social Media(Apr. 23, 2019).

14 CFA Institute Research & Policy Center, The Finfluencer Appeal: Investing in the Age of Social Media (2024) (“Influencers may be sponsored by firms or brands to create content or paid by companies to promote certain products and services. In this sense, influencers can serve two purposes: first, to share information on topics they are perceived to be an expert on, and second, to influence the purchasing decisions of their audience through their expertise and personal branding.”)

15 CFA Institute Research & Policy Center, The Finfluencer Appeal: Investing in the Age of Social Media (2024); International Organization of Securities Commissions (IOSCO), Finfluencers: Consultation Report (Nov. 2024); FINRA, Following the Crowd: Investing and Social Media (Mar. 13, 2023).

16 FINRA, Targeted Exam Letter, [LINK BROKEN]FINRA Provides Update on Sweep: Social Media Influencers, Customer Acquisition and Related Information Protection (Feb. 2023); FINRA, Unscripted Podcast Transcript, Finfluencers: New Marketing Strategies Meet Existing Compliance Obligations (June 25, 2024).

17 Mezzi, Event-Driven Sentiment: AI Insights (May 27, 2025).

18 Id.

19 Johan Bollen et al., Twitter Mood Predicts the Stock Market, Journal of Computational Science (Mar. 2011) (“Although news most certainly influences stock market prices, public mood states or sentiment may play an equally important role.”). Haohan Wang, Sentiment Analysis and Algorithm Trading, Medium (Jan. 15, 2016) (“In order to take advantage of sentiment analysis for us to predict stock market movements, we can utilize the sentiment information as a directional signal to figure out whether to long or short certain stock within a portfolio. Many quantitative hedge funds have been incorporating the element of sentiment analysis in their trading strategies.”).

20 E*Trade, Social Media Analytical Tools (Mar. 2, 2022).

21 Talita Greyling and Stephanié Rossouw, Twitter Sentiment and Stock Market Movements: The Predictive Power of Social Media, Center for Economic Policy Research (Mar. 26, 2025); Mohammad Al Ridhawi, Stock Market Prediction Through Sentiment Analysis of Social-Media and Financial Stock Data Using Machine Learning, University of Ottawa, School of Electrical Engineering and Computer Science (2021) (noting the results of an experiment showing that combining sentiment with financial information can improve prediction performance by over 74 percent).

22 John P. Reese, Gaining An Edge: 5 AI-Powered Strategies For Stock Market Success, Forbes (Mar. 22, 2024).

23 Seeking Alpha, How Does Seeking Alpha’s Crowdsourcing Model Work?; Estimize(Describing the value of their tool that can “leverage the collective wisdom of crowds and receive highly accurate earnings predictions for U.S. equities).

24 See, e.g., Media Watcher, Decode the Crowd’s Voice With Social Media Sentiment Analysis(July 3, 2025).

25 Rongjuan Chen et al., The Relationship Between Twitter Sentiment and Stock Performance: A Decision Tree Approach, Proceedings of the 56th Hawaii International Conference on System Sciences (2023).

26 See, e.g., Talita Greyling and Stephanié Rossouw, Twitter Sentiment and Stock Market Movements: The Predictive Power of Social Media, Center for Economic Policy Research (Mar. 26, 2025); Kumesh Aroomoogan, How Quant Traders Use Sentiment To Get An Edge On The Market, Forbes (Aug. 6, 2015); Haohan Wang, Sentiment Analysis and Algorithm Trading, Medium (Jan. 15, 2016).

27 S&P Global, What Does "Everyone" Think? S&P Dow Jones Indices Introduces S&P 500 Twitter Sentiment Index (Nov. 18, 2021).

28 Global Market Insights, AI In Social Media Market Size - By Technology, By Component, By Application, By Organization Size, By End Use, Growth Forecast (July 2025).

29 See, e.g., Bloomberg, Bloomberg Professional Services: News; Stockpulse, Real-Time Social Sentiment for Smarter Financial Decisions; Context Analytics (f/k/a Social Market Analytics), The Leader in Unstructured Financial Data.

30 See, e.g., E*Trade, Social Media Analytics Tools (Mar. 2, 2022); Interactive Brokers, See How the Market Feels.

31 See, e.g., Social Searcher; Swaggy Stocks; Stocktwits.

32 See, e.g., Tony Sio, Social Media Monitoring with Market Surveillance Tools,Nasdaq.

33 Tony Sio, Social Media Monitoring with Market Surveillance Tools,Nasdaq (“[M]etrics such as the number of tweets or posts, retweets and followers can be leveraged to identify who has the most impact when they talk about a company.”).

34 See. e.g., International Organization of Securities Commissions (IOSCO), Finfluencers: Consultation Report (Nov. 2024) (noting that regulators can “enhance[e] monitoring and enforcement capabilities through data analytics and social media surveillance tools”); see also European Securities and Markets Authority (ESMA), Social Media Sentiment: Influence on EU Equity Prices, ESMA TRV Risk Analysis: Consumer Protection (Apr. 3, 2024), (describing the use of sentiment and attention indicators measured against stock price movements).

35 See, e.g., FINRA Investor Alert: Social Media ‘Investment Group’ Impostor Scams on the Rise (Jan. 11, 2024).

36 As part of FINRA’s research, we engaged with more than two dozen stakeholders, including financial institutions, software service providers, academics, industry observers and government entities.

37 See, e.g., VettaFi, Social Media ETF List.

38 VanEck, BUZZ VanEck Social Sentiment ETF.

39 Id.

40 SoFi, Press Release, SoFi Debuts its First Crowdsourced ETF Based on SoFi Social 50 Index (July 1, 2020).

41 See, e.g., Robinhood, Robinhood Investor Index.

42 CFA Institute Research & Policy Center, The Finfluencer Appeal: Investing in the Age of Social Media (2024).

43 Id.

44 Talita Greyling and Stephanié Rossouw, Twitter Sentiment and Stock Market Movements: The Predictive Power of Social Media, Center for Economic Policy Research (Mar. 26, 2025).

45 See, e.g., CFA Institute Research & Policy Center, The Finfluencer Appeal: Investing in the Age of Social Media (2024); Isabella Kwai, Financial Advice on Social Media Is Growing. And Risky, The New York Times (Jan. 25, 2025),.

46 Mohar Chatterjee and Maggie Miller, A New Look at How Bots Shape Social Media, Politico (Sept. 10, 2025).

47 Sue S. Guan, Fraud on the Social Media Market, 119 Northwestern University Law Review Colloquy 206 (2024).

48 FINRA, Investor Alert: Social Media ‘Investment Group’ Imposter Scams on the Rise (Jan. 11, 2024); Meta, Avoiding Investment and Payment Scams Online(May 7, 2025); Meta, New WhatsApp Tools and Tips to Beat Messaging Scams (Aug. 5, 2025); Federal Bureau of Investigation, Public Service Announcement, Alert Number: I-070325-PSA, Fraudsters Target US Stock Investors through Investment Clubs Accessed on Social Media and Messaging Applications (July 3, 2025).

49 FINRA, Investor Alert: Relationship Investment Scams (Sept. 10, 2024); FINRA, Investor Alert: Social Media ‘Investment Group’ Imposter Scams on the Rise (Jan. 11, 2024).

50 See, e.g., Sonja Warkulat and Matthias Pelster, Social Media Attention and Retail Investor Behavior: Evidence from R/wallstreetbets, International Review of Financial Analysis (Nov. 4, 2024).

51 FINRA, press release, FINRA Foundation Releases Findings on Fraud Awareness Among Investors (Oct. 7, 2025); 72% of Social Media Followers and Half of US Retail Investors Open to Risky Offers: FINRA Foundation, Finance Magnates (Oct. 7, 2025).

52 Qing Liu and Hosung Son, Methods for Aggregating Investor Sentiment from Social Media, Nature (July 17, 2024).

53 FINRA, FINRA Provides Update on Sweep: Social Media Influencers, Customer Acquisition and Related Information Protection (Feb. 2023).

54 In this context, technology neutral means that policies and regulations focus on activities and outcomes rather than on particular technologies.

55 See, e.g., FINRA Rule 2210 (Communications with the Public); FINRA Rule 3110 (Supervision); FINRA Rule 3120 (Supervisory Control System); FINRA Rule 4511 (General Requirements); FINRA Rule 4530 (Reporting Requirements); Securities Exchange Act (“SEA”) Rule 17a-4(b) (detailing firm obligation to retain records of digital communications that relate to their “business as such”); SEA Regulation Best Interest. For additional information, you may refer to FINRA Key Topics Page on Social Media.). See also, FINRA Regulatory Notices 24-09; 19-31; 17-18; 11-39; 10-06. There have also been disciplinary actions taken against firms relating to their social media activity. See FINRA press release, FINRA Provides Update on Sweep: Social Media Influencers, Customer Acquisition and Related Information Protection (Feb. 2023); Bruce Kelly, FINRA Penalizes Another Broker Dealer for Social Media Miscues, Investment News (May 28, 2025); FINRA Letter of Acceptance, Waiver, and Consent No. 2021072581101, Re: M1 Finance LLC (Feb. 12, 2024), FINRA Letter of Acceptance, Waiver, and Consent No. 2021072501001, Re: Cobra Trading, Inc. (Mar. 25, 2024).

56 See FINRA Interpretive Questions page.

57 Parties should submit in their comments only personally identifiable information, such as phone numbers and addresses, that they wish to make available publicly. FINRA, however, reserves the right to redact or edit personally identifiable information from comment submissions. FINRA also reserves the right to redact, remove or decline to post comments that are inappropriate for publication, such as vulgar, abusive or potentially fraudulent comment letters.