A few things I learned today about text messaging by stock trading platforms.
This afternoon I read through the SMS text messaging agreements of E-Trade, Schwab, Fidelity and Robinhood. Sounds exciting, right? In doing so, it became clear we are not all treated the same (that’s the obvious part) and that we personally play a large part in their decisions about how and when they send text messages to us.
First and foremost, text messaging is not for everyone and does not add value to all investors. I am a low volume trader, in fact I wouldn’t even classify myself as a “trader”. I probably fit best with the group of 50M plus people that are in the market but really are not trading at all but are investing for the long-haul. This could be generational, but nevertheless, other than the usual identity verification text, I don’t receive text messages from my trading platform.
Day traders: according to zippia, there are just 1,823 day traders in the United States. Under NASD and NYSE rules if you buy and sell the same stock or option on the same trading day four or more times within a period of five trading days and this activity makes up more than 6% of your trading activity, then you’re a day trader. Now, I don’t know where zippia get’s their data on this one but 1,823 is not a big number and who needs a text message anyway if you’re online and trading multiple times a day, every day. The online service can tell you if your trade went through, was cancelled, expired, etc. Texting is clearly not a big need in this space.
For those in the middle, the group of people that are actively tracking their portfolio, or have built a “watchlist” of companies, for possible investments, where is the ability in the trading platforms to flip the switch and receive a text message on that “hot off the press” SEC filing, merger announcement, etc.? From what I can tell it is difficult to find at best.
Sure you can track the company on Google, Twitter, social media, Facebook, etc., but from a trading platform, investment perspective, it seems the heavy hitters on Wall Street are behind the curve. And by that I mean they’re not using the one communication channel that has a 95% read rate, with a 90 second open rate among 83% of millennials… to serve up highly perishable and useful investment details (i.e. SEC filings) or other critical events that are important to their customer in making investment decisions.
#SMS-Marketing #Text-messaging #stock-alerts