Kudos to BusinessWeek’s David Bogoslaw for an excellent piece (and interviewing me) last week entitled “Piqqem: Tapping the Investing Wisdom of the Crowds“. Bogoslaw takes a objective look at wisdom of the crowds, of Piqqem, and its CEO, Jett Winter. I’ve written about Piqqem here and generally like the idea.\ about trying to gauge sentiment, how it changes, and how this influences stock pricing.
I can say that’s it’s really early days as Piqqem and its competitors as they all appear to be still acquiring data. The next step is analyzing this data to help investors really use this information in their investing. I think it’s also important to note that crowdsourcing really inhabits the other side of the spectrum from expert investing models like Covestor that aim to identify and track best athletes.
From the BusinessWeek article:
Can a sentiment survey of a bunch of individual investors actually predict stock price performance? Crowd Technologies—a neophyte online investing community whose Web site Piqqem enables people to vote on the direction they believe individual stocks will follow—has begun to collect data that shows a correlation between changes in sentiment over short periods of time and the propensity for earnings to outperform or underperform market forecasts.
Piqqem is based on the concept of the wisdom of crowds, the belief that a sufficiently big and diverse group of people will over time be more accurate in their estimates and predictions than even the most talented individuals. Jett Winter, Piqqem’s chief executive, has a background in software and has headed multiple startups in Silicon Valley over the past 25 years. He also runs an investment bank, Winter Advisors, and is interested in the trading opportunities that will come out of crowdsourcing stock sentiment.
Read the whole article.