Skip to main content

Steve Gomez is a lifelong stock trader, most recently making a career of it from his home office. But it just isn't the same as when he traded on a retail floor in the 1990s.

"I really enjoyed being on a floor where there was a community of thought and ideas," the San Diego resident said. "Those days disappeared in the 2000s as retail traders were forced back to their homes or private offices with the closure of retail trading floors across the country."

Mr. Gomez, however, is finding a substitute in today's technology: Twitter. And, specifically, StockTwits, a service started by serial entrepreneur Howard Lindzon, a Toronto native.

"As soon as I realized that the Twitter thing was probably breeding some good stock commentary, I found StockTwits in February, 2009," said Mr. Gomez, who has a website with his trading partner called "The idea flow is great, and just like in a real room you can start to get the personality of people after following them. You can't fake it on there. So the cream really rises to the top and that's fun to watch."

StockTwits is the embodiment of social media, the empowerment of the basement day trader or the small-time money manager. It's a platform where users get judged on the quality of their picks, links and views, not by the names of the too-big-to-fail banks that employ most of the experts given exposure by the mainstream media.

Mr. Lindzon started this "Facebook of finance" in 2009, and today it has 100,000 registered users and receives more than 8,000 tweets per trading day. It was the seemingly natural next step of a career that has so far seen him dabble - often to great profit - in technology, finance, his leisure-time passion of golf, and even little squeeze balls with corporate logos.


"I think I have this knack for products," he said. "I go on my instincts and I've been lucky. If I stick with my instincts, I've been rewarded. I've made plenty of mistakes where I chase money, not the idea."

Twitter takes some getting used to for people who are accustomed to communicating in full, punctuated and properly spelled paragraphs. It's gotten a bad reputation as being the home for irrelevant 140-word blips sent most famously by such people as Ashton Kutcher.

And, to be fair, it's intimidating to sort through the sheer chaos of millions of staccato, abbreviated tweets and finding who's worth "following" and who's not. (Yes, Mr. Lindzon knows that what you do on Twitter is a "tweet," not a "twit," but says "twits' was a play on "when CNBC is on and you see all these guys from Goldman or Morgan Stanley talking ..."). Mr. Lindzon describes StockTwits as both an "aggregator" of financial tweets and, more importantly, a "curator."

Users are encouraged to put a dollar sign in front of a stock ticker when they tweet about an individual company - like this: "$AAPL." General market commentary has two dollar signs at the end of the tweet.

Beyond that, StockTwits employs actual human beings to be on the lookout for scammers or pump-and-dump artists promoting five-cent stocks. "It keeps the stream clean, so to speak, so we have a community of good people," said Joe Donohue, a New Jersey hedge-fund manager who's a featured tweeter on StockTwits under the name "upsidetrader."

Serial Entrepreneur

Mr. Lindzon grew up in Toronto living "a pretty undramatic life" as the son of a securities lawyer and stay-at-home mom. After Forest Hill Collegiate, he went to the University of Western Ontario and, after graduation, went to work for a brokerage firm in 1987, the year of the great October crash. So he found himself laid off just a few months into his career.

He spent the next three years in school, first at the University of Windsor, then at Arizona State University for an MBA. Needing a work visa, he returned to the brokerage world. But he soon found himself with an itch to get involved in entrepreneurial startups.

"Every business that called that had an idea, I wanted to fund," he said. "I just wasn't cut out to be a stockbroker."

His big break came after reading an article in the Phoenix Business Journal about a company called Pro Innovative Concepts that made tchotchkes for corporate customers. Its breakthrough: "the gripp," a squeeze ball that, Mr. Lindzon said, ended up selling 25 million units in the latter half of the 1990s.

"The markets were on fire and our company was just printing cash, so me and my partner were trading stocks at work," Mr. Lindzon said. "So I started a hedge fund in 1998 just to change things up."

The hedge fund was a part-time occupation, with only about $10-million of acquaintances' money. Instead, Mr. Lindzon sought more entrepreneurial investments. To buy into in 1999, he also had to put money into a second company that ultimately became While carsdirect tanked, was ultimately sold to eBay.

Biggest Mistake

His biggest business misfire, Mr. Lindzon freely admits here and on his blog, was when the head of compliance at Empire Capital Group, a broker-dealer he owned, traded improperly in customer accounts and filed false reports with regulators. The employee settled with regulators in 2003 by agreeing not to work for a stockbroker again and by paying $40,000 in restitution, according to records with the U.S. Financial Industry Regulatory Authority. For Mr. Lindzon, "it was almost career-ending," he says now.

Mr. Lindzon later invested in a golf-booking website called, ultimately sold to Comcast. But by this time, Mr. Lindzon had been bitten by the social media bug, and he started a website called "WallStrip" that showed three-minute investing videos he produced and often starred in.

WallStrip, also oddly titled, "was just a word that was available - - and we thought maybe comic strip meets Wall Street," he said. Mere months later, the video site was sold to CBS "for under $5-million," Mr. Lindzon said. CBS then took just over a year to shut it down.

Mr. Lindzon, who has lived in Phoenix since graduate school, estimates he devotes at least 90 per cent of his time to StockTwits.

David Cohen is an angel investor in StockTwits and the CEO of a business-development program called TechStars, which admits 10 early-stage Internet startups in need of mentorship and provides the seasoned entrepreneurs to do it. Mr. Lindzon has been involved since the beginning of TechStars four years ago, he said.

"Every year he does a talk about how you should work on things you're passionate about, and how they can make life more fulfilling and turn work into play," Mr. Cohen said. "If you're not working on something you're passionate about, it's a long hard road."

The combination of his brokerage background and his embrace of emerging social media means StockTwits fits that bill for Mr. Lindzon.



Seeking Alpha

It bills itself as "the premier website for actionable stock market opinion and analysis." The site picks and publishes roughly 250 articles a day written primarily by money managers and investors. It offers e-mailed newsletters and also publishes company conference-call transcripts for free. Its tagging and sorting of articles allows a great deal of customization: A column of feeds compiles "instablog posts," comments and articles by Seeking Alpha contributors whom a user has chosen to follow, or on stocks in a user's portfolio.


This portfolio-sharing site allows traders to post their trades and followers to trade in their footsteps. Part of Covestor Ltd., a U.S. registered investment adviser, it accepts minimum investments of $10,000 in a managed brokerage account. Users fill out a risk profile and allocate their money using investment models. Any investor can manage one of Covestor's models; the fees from the end user are split between Covestor and the trader/manager depending on their licensing status under U.S. law.

Yahoo!, Google, etc.

Traders who use technical analysis - picking stocks in part through analysis of past pricing and volume data - have seen an expanding amount of information on the finance sites of Yahoo! and Google as well as from BigCharts, a site owned by MarketWatch, a sister company to the Wall Street Journal. The sites generate historical charts using a range of technical measures including Moving Average Convergence/Divergence; Rate of Change; Bollinger Bands and Parabolic Stop and Reverse.