Blogging About Stocks

Weblogs Inc/AOL launched Blogging Stocks this past week and it has been criticized by The Stalwart and others.  Jason Calacanis has pretty good roundup of the good and bad reviews on his blog.

All you have to do is give Blogging Stocks a quick read and you know why its getting criticized. The posts are not particularly insightful and worse – they aren’t very actionable.

Insight and actionability are the key to writing about stocks.  Tell me something I don’t know or didn’t really understand and give it to me in a way that leads to a trade.

But I don’t agree with the premise in The Stalwart’s title – Why Blogging and Stocks Might Not Be a Good Fit.

I think blogging and stocks are a perfect fit.  The stock market is all about knowing something before everyone else and being able to profit from it.  Blogging can and will and already has impacted Wall Street. My first introduction to blogs was seeing Jim Cramer in action at TheStreet.com. When Flatiron Partners invested in TheStreet.com in early 1998, Jim was blogging stocks like crazy and it was an impressive feat.  I didn’t realize he was blogging at the time, but I understood immediately the power of what he was doing and to this day, I feel that blogging is a completely natural act when it comes to thinking about and trading stocks.

What has to happen though is lots of people who are good investors, analysts, and/or traders need to start blogging about what they are thinking and doing. Writing something down is a great way to think about an investment and I think we are going to see more and more investors do just that via blogs.

It’s already happening. The Stalwart does a good job of blogging about stocks.  Here’s a post from The Stalwart about declining Jeans prices (citing a fashion blog as reference).

Seeking Alpha has created a network of blogs about various investing sectors.  It showcases the power of a blogging platform for investors.

I know a few former Wall Street analysts who are doing other things now but still blog about stocks from time to time.

Andy Kessler now mostly writes books and a column for the Wall Street Journal, but his WSJ columns are available on his blog.

Henry Blodget blogs about stocks at Internet Outsider.

And Bill Burnham blogs about stocks and other interesting things at Burnham’s Beat.

Some of the blogs on my blogroll are home to interesting stock blogging.

Mark Pincus told everyone he was shorting eBay at $39/share in October 2005 and explained why as well.  The stock went up to the mid $40s by the end of the year but is now at $34/share.  It would be great if Mark posted on whether he’s still short and why.

Howard Linzon is a friend of mine in Phoenix that trades stocks and he writes out loud as he thinks about his trades.  This post is about Apple Computer. He says it’s not a recommendation to buy the stock, but if you read it, he’s got to be long Apple and he makes a convincing case why we should all be long Apple.

I have also blogged about stocks from time to time.  In December of 2004, I proposed a hedged trade going short on Sirius and going long Clear Channel. Both stocks have declined, but Sirius has falled much farther generating a nice gain.

I think there is a ton of insight, and much of it actionable, on blogs right now. It’s just not on one single blog. Blogging about stocks seems to be more of an opportunity for aggregation (ala Memeorandum) than it is an opportunity to recreate TheStreet.com with a blog.

With tools like PersonalBee and Megite, anyone can create their own Memorandum for stocks like Gabe Rivera did for Robert Scoble’s tech feeds to create Memorandum.

That’s what Jason should have done with Blogging Stocks instead of trying to create a destination blog for stocks. You need someone like Jim Cramer to make that work and he’s got something like three day jobs already.

UPDATE: Gabe Rivera commented on this post and explained that Memorandum was not built exclusively on Robert Scoble’s feeds, but rathher a much larger set of feeds that he adjusts on a daily basis.  I stand corrected and apologize for trivializing how Gabe created Memorandum which is an incredible resource for those interested in staying current on what’s happening in technology.