Crowd sourcing someone else’s stock portfolio

If you have an opinion about the stock market, you can voice it without spending any of your own money.

Robinhood, the free stock trading app popular among millennials, is being used to let internet strangers invest $50,000 of real money.

Using Twitch, the Amazon-owned video game streaming site, a software developer has set up a live stream of his Robinhood portfolio. Viewers of the live stream vote on which stocks to buy and sell and the moves with the most votes are executed automatically through Robinhood.

The collective will determine what gets bought and sold, but they, the voting public will not personally benefit from any gains. Also, since you aren’t risking any of your own money, you won’t be saddled with any of the potential losses either.

I suppose you could invest your money alongside what the public suggests. Who knows, maybe you and this Robinhood / Twitch portfolio will outperform the S&P 500 index found. Odds are it won’t. Recall that Warren Buffett recently won a bet with a hedge fund manager. Buffett allowed the hedge fund manager to select any five hedge funds. Buffett suggested that they S&P 500 index fund would beat these hedge funds over a ten-year time frame. He was right.

If a professional hedge fund manager can’t beat the S&P 500 index fund’s performance over the long haul, what makes you think you or all of those people voting could? While it’s possible that this portfolio will beat the index, the likelihood is, it won’t.

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