With its SocialSentiment Portfolio, eToro gives retail traders access to ESG companies
A new social sentiment portfolio called SocialSentiment has been introduced by the social trading platform eToro, which is based in Israel. The most recent addition to the eToro product roster gives retail investors access to US-listed businesses recognised for their strong ESG initiatives.
According to a press statement on Monday, the newest social sentiment portfolio was developed in partnership with Sentifi, an AI-driven alternative data engine that collects current trade signals by analysing more than 2 million news articles and 500 million tweets each day.
Sentifi examines approximately 50,000 different financial products, such as indexes, equities, commodities, currencies, and mutual funds. By assigning an asset a “sentScore,” SocialSentiment, for example, analyses the market feelings surrounding that asset while building portfolios. With regard to SocialSentiment, this has made it possible to develop a portfolio that monitors businesses with a positive social media presence.
“eToro pioneered social investing and showed how the power of social can empower people around the world to build their wealth and take control of their finances. With this portfolio, we aim to offer retail investors exposure to stocks that are being discussed in a positive light on social and digital channels, adding an extra layer of insights. We are looking forward to partnering with the Sentifi team, and working together to harness the power of social networks,” Dani Brinker, the Head of Investment Portfolios at eToro.
The top 10 S&P 500 stocks that satisfy social sentiment and ESG criteria are included in the monthly rebalanced portfolio, and they are ordered by lowest risk over attention-weighted sentiment score. Investors may simply track the performance of their portfolio using eToro’s sophisticated tools and charts with a minimum investment of $500 USD while remaining up to date on industry changes through its social feed. Nevertheless, US investors are now unable to access the portfolio.
The portfolio currently includes businesses including Verisign, Teradyne, Dollar Tree, Alistate, and F5 Networks, among others.
“Social networks, news, blogs and forums are a valuable source of changing risk for asset classes and offer dynamic views on ESG performance appreciation and degradation for companies globally – essential for constructing portfolios that outperform a benchmark. Sentifi is delighted to partner with eToro to offer eToro’s Social Sentiment portfolio,” Marina Goche, the CEO at Sentifi, added.
Late in January, eToro unveiled InvestorAI-US, a brand-new smart portfolio that employs artificial intelligence to give retail investors exposure to the stocks of 12 fast-growing American companies.
A sizable percentage of retail investors (69%) feel confident in their investment portfolios, according to the most recent eToro study, which was performed a month ago. Notwithstanding the prolonged weak market that affected financial markets in 2022, this renewed optimism may be explained by investors’ diminished concern about the perceived threat of inflation.
According to the survey, a bigger percentage of young retail investors between the ages of 18 and 34 (76%) exhibit greater risk tolerance and have a favourable or neutral opinion on the downturn in 2022. In contrast, just 60% of senior investors 55 years and older agree with this statement.
“The fact that two thirds of retail investors feel indifferent, or even more positive, after the worst year for markets in a generation might seem odd. But the majority of this cohort think in years and decades. For those with longer time horizons, the back end of 2022 has offered a chance to buy companies at lower valuations, improving the outlook for long term returns,” Ben Laidler, the Global Markets Strategist at eToro, commented.
The extension of eToro’s services in the Americas was disclosed in the two updates that were released in February. The New York State Department of Financial Services has issued the social trading network with a BitLicense, or virtual currency licence. The trading network’s American affiliate, eToro NY LLC, was used to get the licence.
In a statement on its website, eToro stated that it would be able to offer trading services for stocks, cryptocurrencies, and options to residents of New York thanks to the recently acquired licences. Additionally, the business stated that once eToro NY LLC is operational, it plans to broaden its virtual portfolio and offer social investing tools to New Yorkers.
The company has expanded the selection of assets available to its users in Brazil for investment in the interim. Prior to this change, traders in the Latin American nation who were on boarded on or after February 28, 2018, could only trade bitcoin positions based on the Brazilian real.
Brazilian users can now trade exchange-traded funds, stocks, and contracts for difference, but not FX instruments, thanks to the most recent upgrade. You can read more about the broker in our eToro Review.
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