About My Term Project

My research paper is about the role of new media in the financial markets. Initially I was going to focus only on twitter and how it influences investors and traders, but as the semester went on, I decided to also cover other new media technologies, such as blogs, wikis and the new phenomenon of social investing.

I choose this topic because I’m interested in financial markets and their close relationship with technology. My research is based of scholarly papers, books and online newspaper articles.

In my paper I discuss how the financial industry has always been one of the early adopters of new technologies.What started  as a bunch of guys standing and shouting at each other outdoors on the street in the 1790’s, is now a highly sophisticated industry fully dependant on technology and computing power. Financial markets have always been shaped by technology. When the telegraph was first introduced traders quickly adopted it and in 1867 the ticker tape was born, a little device that allowed the transmission of information from very long distances instantly.

Getting back to the present, new media has made a huge impact in the financial markets. I discuss how knowledge is being shared through blogging, wikis and online videos. There are many approaches to understanding the markets and the financial blogosphere is a good representation of such views. There are many blogs on fundamental analysis talking about financial statements and company performance, others discuss technical analysis and the behavior of a security’s price, and other blogs deal with the topic in a more quantitative and systematic approach. I also discuss how micro blogging, specially twitter, is a good platform from information sharing.

I explore social investing websites such as Covestor and Kaching, which allow average investors to mimic trades from more advanced investors. And also talk about how fully automated trading systems can be used by average investors who can subscribe to specific trading strategies through websites such as collective2.com and strategyrunner.com.

Privacy & Confidentiality

Every now and then I hear about people getting fired over what they posts or do in Facebook. The problem I see is a lack of common sense and users not doing their due diligence in protecting their private information.

Social Networking sites, such as Facebook have their own privacy mechanisms that allow users to hide certain information from certain groups of people. Most of the time, users don’t bother to check their privacy settings and leave everything to be easily accessible by everyone. It seems people are blinded by a false sense of privacy given by the individuality of using a computer while updating their profiles. People say and do things online, they wouldn’t do in real life, for example telling their new boss how boring the job is.

However, not all responsibility lies within the end users. Social networking sites are not known to be very secure in regards of protecting your personal information from external threats. Glitches and bugs can create security holes that expose your personal data. Last spring one of these glitches allowed anyone to access private pictures in Facebook profiles and this summer Twitter was hacked. These websites quickly fixed the security problems, but not all development teams respond adequately and on time when such security holes appear – and that is something users should take into consideration when joining a social network.

Our Class Wiki - So Far

I signed up for the tasks of layout editor and graphic editor for Baruch New Media’s wiki. These tasks involve working in all content pages in the wiki, mainly dealing with the visual representation of the content.

I have added graphical elements to many articles and edited existing images. Many articles suffer from huge pictures which need resizing, other articles contain too many images, which don’t really add much value to the content. I call this the MySpace effect, in which users want to personalize the pages they are working in, sometimes in detriment of the overall look and feel of the Wiki.

before	after

 

There are many articles where the heading of a section is a link to another article. For example the How New Media are used in Business article has an introduction section with content introducing the subject, but the heading links to another article that also introduces the topic. This confuses not only users, but also people collaborating, since they add new content to a section already explained in the main article page. In such cases what I do is try to merge content or indicate there’s another article that expands on the topic.

Main article	New page with different content and same subject

There were other articles such as New Media in Transportation where the article page contained links to new pages with very few content – two or three paragraphs. In this case I combined all separate pages into one main article.

before	after

Overall, I have been making small changes across all pages, formatting text, taking away unnecessary visual elements, fixing external links… and so on. My goal is to keep a usable Wiki with a constant visual layout.

I have not created any new page, but I plan to do so with content from my term research project within the next three weeks as the semester approaches its end.

The Next New Thing

CBS 60 minutes ran a segment of “Neuronal Decoding,” which talks about research being done in reading neuronal activity and deciphering what a person is thinking.

Watch CBS News Videos Online

In 1997 Bill Gates said:

“I don't think there's anything unique about human intelligence. All the neurons in the brain that make up perceptions and emotions operate in a binary fashion. We can someday replicate that on a machine.”

If we assume that the human brain operates in a similar fashion to a computer, then we can perform I/O operations, such as reading and writing data. There are many possible applications that could derive from neuronal decoding and encoding.

In the last discussion on blackboard I read many interesting ideas about virtual reality and its uses. An idea that caught my attention is how virtual reality allows people to do things that are impossible to do in real life, such as flying. Imagine experiencing flying with all your senses, picture yourself as Emperor of Rome in a simulated environment or your favorite book’s main character.

Current technology has its limitations in providing  immersive experiences. Advances in neuronal decoding and encoding could help bringing more reality into virtual reality. I might be getting ahead of myself, but I believe that in a not-so-distant future, we will be able to share manufactured – or even real life – experiences and thoughts in a more profound way.

Imagine the entertaining industry moving from producing films and games to creating virtual experiences. Instead of a passive evening watching a movie, you could actually experience what the protagonist does using all your senses.

Advice to Baruch College

I believe Baruch College is doing a good job by leveraging the power of social media through Facebook, LinkedIn, Twitter and Blogs. On the school’s website there is a list of social networks and other resources – the list can be accessed here. However, there are few things that can be improved.

Recorded Lectures 

Ilona on her blog post addressed the benefits that podcasting classroom lectures would bring to students. I agree with her views. UC Berkeley has podcasts and webcasts for some of their undergrad courses available here. Yale also has some courses available here. Baruch already has an iTunes page and a YouTube page that contain videos from special events, such as Executives on Campus, but it would be great to have  recorded lectures of the most popular courses. I think it would greatly benefit students, since current students would be able to review the lectures and prospective students could explore the topics covered in courses they are interested in.

Enhanced Courses

Baruch has certain courses designated CIC (Communication Intensive Courses), I believe these courses could accomplish their goals by requiring students to Blog frequently as extension of other communication intensive in-class activities.

There are other courses that require heavy team-work, these classes could be greatly improved by assigning wikis to students to collaborate within their groups. In one of my courses we collaborate mostly through email, and keeping track of the conversation and deliverables is not easy. I went in search of online collaborative applications and found few wikis (pbworks.com & wikispaces.com) that fit the mold, however, the new issue was getting everyone familiar with wikis. A way to solve this, would be to require students to complete a new media seminar before getting into Zicklin School or advanced courses.

EBook Readers

It would be environmentally friendly to have a special program that lends EBook readers to eligible students, say those with a GPA greater than 3. This would require professors to use books from publishers that provide EBook versions of their printed works.

My New Media Class - So Far

New media comprises many technologies that have radically change the way we communicate and exchange information.

Online publishing technologies such as blogs skyrocketed few years ago with the emergence of publishing platforms such as Wordpress, Blogger, MovableType and others , bringing new ways for people to disseminate their ideas. Recently new technologies, such as Twitter and Tumblr, have brought micro-blogging to the mix, allowing faster and concise methods to spread information.

Wikis make possible online collaboration, by allowing its users to edit content, bringing dynamism to the way content is created and allowing it to evolve and stay updated. Wiki technologies make online encyclopedias such as the Wikipedia possible, but since everyone can edit content, critics demand mechanisms and rules to prevent vandalism and maintain accuracy, as noted in this article on CNN.com.

Social networking technologies have emerge as preferred venues for social interaction online. Sites like Facebook and MySpace allow people to befriend each other and form online groups. Instant online communities and social networks can be set up quickly with services like Ning. Virtual worlds allow users to interact in 3-D worlds and perform many activities that mimic real life, such as going to a club and assisting to concerts.

The internet is the preferred venue for new media, without it many technologies that are changing and replacing old ways of communication, wouldn’t exist. Old media such as Newspapers and TV are making their way into new media by employing the use of online newspapers and streaming TV online respectively. 

Ubiquitous access to the internet and the convergence of new media and geolocation technologies, bring new online services such as loopt, which allows users to find friends wherever they are. 

Modeling Reality with Virtual Worlds

Virtual worlds offer a virtual representation of any imaginable world. The most known virtual environment is Second Life, which allows users to hang out and interact in a 3-D world through the internet. Users are represented by personalized avatars and are able to assist to virtual gatherings and do other activities that imitate real life.

Activities such as visiting a club and enjoy musical performance are possible thanks to virtual worlds. Companies, such as MTV Networks, are seeing the potential in building their brand through online virtual worlds. According to The New York Times, in its article I’ve Been in That Club, Just Not in Real Life, In 2006 MTV started to build a virtual representation of the Southern Californian beach community from one of its reality shows, among with other virtual properties with the goal to create virtual social networks and platforms to discover artists.

Virtual worlds can facilitate meetings and reduce travelling costs, which is beneficial when the attendees reside in different geographical zones. Last year the Congress broadcasted a hearing with some attendees logged from a virtual room in Second Life, as noted in this article from The Washington Post.

There are many applications to virtual worlds and the possibilities are endless, however, similar to social networking, they present some disadvantages and negative side effects. Biologically our bodies are not designed to inhabit in virtual worlds, hence we cannot properly experience the full benefits of real life social interactions.

In the future I see virtual reality gaining more prominence and becoming a huge part in our lives. As computing power increases and manufacturing processes bring prices down, a better and more realistic virtual representation of the world could be possible. Avatars would no longer be pixelated and could better display a  bigger array of human expressions. Full immersion would be possible with advances in haptic technology, which allow the use of the sense of touch. Eventually, as technology would be able to replicate even in more detail the real world, the appeal of virtual worlds would also increase.

Social Networking

The growth of social networks imposes new rules and demands innovative ways for organizations to reach their intended audience. Organizations can easily interact with people, build their brand online, improve their business intelligence practices, and work collaboratively thanks to social networking tools.

Social networks offer many advantages. The New York Times in its article The Media Equation – How Obama Tapped Into Social Network’s Power, addresses how the Obama Campaign was able to create a brand and build a sense of connectedness with its supporters by leveraging social networking tools.

Besides political organizations, businesses are also making use of social networking. Chuck Hamilton, from IBM, in an interview for Maclean’s Magazine notices that “social networks are emerging as key tools for business innovation.” (access the complete interview in a pdf file from here). Hamilton addresses how companies can collaborate with people from different backgrounds working across the world. He also mentions the usefulness of these technologies in acquiring valuable information from customers and learn how to better serve their needs.

While social networking technologies provide many benefits to organizations and end users, there’s also important to acknowledge some of its negative side effects such as the loss of privacy and the lack of intimacy face-to-face relationships provide.

TweetDeck

I’ve noticed many classmates, mostly from the non-online section, joining twitter over the last few days. I want to recommend the use of TweetDeck to fully enjoy what twitter has to offer. TweetDeck is an application you can install in your computer (Windows & Mac OS) and integrates with Facebook and MySpace.

The following video covers the main benefits and features.

(Video from http://www.pcmech.com/)

If you want to try it out, you can find it at http://www.tweetdeck.com/beta/

Some numbers…

For those of you researching social networking websites, here are some statistics http://www.ignitesocialmedia.com/2009-social-network-analysis-report/

An example:

On Social Networking Sites

I’m not a big fan of social networking sites, mostly because of privacy concerns. However, in the past I have used Hi5 and Facebook. I joined Hi5, which is very popular in Latin America, because many old friends had set up profiles there and at the time it made sense to join the network to keep in touch. Later, they were moving to Facebook, so, I also joined Facebook. This brings an important characteristics of social networking sites, and that is, users define and make them grow. Aesthetics, features, and other quality issues are secondary, without a solid user base, there’s not network.

Many of these websites share common features, such a profile page where users describe themselves and post pictures and videos, a private and public messaging system to communicate to each other, and “friending” capabilities. Users with similar tastes and interests can befriend each other, create groups and grow into communities.

Right now, the only social networking site I use is Twitter. Initially, I was reluctant to create an account because of the amount of bots and noise (nonsense tweets), but chose to give it a try. Twitter is a mix of micro-blogging and social networking, on it you “follow” people and can choose to monitor certain topics. I find it to be very good at extracting information once you carefully choose whose tweets to follow.

Source: Chicago Tribune

Facebook is the most popular, and seems to have many good qualities, such as its openness to third party developers which enhances the end user experience. Anyway, like similar sites, it can become a hassle to maintain a profile and another inbox besides your primary email address. 

I attempted to delete my Facebook account two years ago, and couldn’t finish the process. They seem to have worked out a scheme to prevent you from doing so, and keep your data forever.

For now, I’m sticking to social networking sites that provide me value. This doesn’t mean Facebook is not a valuable tool, but at least for me and my current goals, it’s mostly a liability. I find LinkedIn to be more useful.

Blog vs. Wiki

Blogs are a collection of dated entries classified by categories and sometimes labels. Blogs can have multiple authors, but each entry or post can only be written by one author, which makes blogs mostly an informative medium. Wikis, on the other hand, are collaborative since they are a collection of entries or articles that can be created and edited by multiple authors.

Entries in a blog can be very biased, but have the advantage of allowing visitors to leave comments, which incites discussion and participation. Since entries are time-stamped, their longevity is short and the subject get lost in the archives.

While wikis don’t have comments, they allow visitors – given the right permissions – to add and edit content, which makes them more dynamic than blogs. The collaborative nature of wikis makes them less prone to personal biases, and are often consensus builders as pointed out here. Wikis are not as time-centric as blogs, and since each user is a collaborator, the subject evolves and its information stays current.

Update: 10/7 After looking for a hosted wiki to manage a group project for one of my courses I discovered some wikis, such as PBworks, have commenting systems. A feature I’m not sure is available in MediaWiki. For those not aware, MediaWiki is the backbone of Wikipedia and Baruch’s new media wiki.

Did you Know…

how fast new media is changing our world?

Michael Hyatt has transcribed the stats from the video. You can read them by clicking here.

Old vs. New

The rapid adoption of Gutenberg’s printing press resulted in the propagation of books and newspapers, which subsequently became the mediums of choice to spread information. Such mediums, along with more recent ones, like radio,television and the telephone, are now considered old media.

The times are always changing and so are the ways in which we communicate. The continuous advances in information technologies are facilitating the exchange of ideas and information and changing our content consumption habits. Such innovations are simultaneously threatening old media’s relevance and business models.

Just a week ago music publishers, who are reluctant to adapt to new changes in the marketplace, went against the iTunes store looking to collect fees for providing 30-second song samples (read more here). An act that comes up as greedy, since song samples are supposed to provide a preview to users, so they can make informed purchase decisions.

The newspaper industry is also going through difficult times, specially after the current downturn in the economy,  mostly because they are competing against online websites for readers and advertisers. Most newspapers are offering digital versions of their content online in an effort to maintain their market share, but this doesn’t necessarily guaranteed good results, as noted in an article by Stephanie Clifford from The New York Times. Previous advertisers are not necessarily keeping their business with newspaper’s online editions.

Changes are also taking place in the book industry, specially after Google took the task to digitalize a massive amount of books and make them available. According to some critics this would violate copyrights. Digitalized books are now being offered as ebooks and audiobooks, such changes in the marketplace are raising new issues, such as ownership. Recently Amazon deleted purchased books from many customers’ Kindles.

Old media is converging with new media and during the process I’m sure the clashes will continue, some business models will die and others will flourish giving birth to new industries.

How the Net aids Dictatorships

I enjoy watching TED talks and this presentation by Evgeny Morozov is one of the reasons why. He argues that new media may actually reinforce authoritarian regimes by the use of political operatives to spread disinformation.

New Media & Financial Markets

My research project will be on the role of new media in the financial markets, specifically, how twitter and blogging are becoming part of the decision making process for traders and investors.

I will focus on how traders and investors are influenced by these new technologies and how new media can be used with other technologies and processes, such as data mining, in developing trading strategies.

Something that I find interesting is how people base their actions on others, and I believe this herd mentality is harmful in trading. So, I expect to cover the psychological impact of new media as well.

What’s New Media

The ever increasing computing power and the explosion of the information age have significantly changed the way information is produced, distributed and consumed. New media is an expression of such technological progress in a free society. In essence new media is the democratization of content. Ideas are no longer tied to the status quo, since everyone can create content and easily communicate their opinions.

The internet has undergone a paradigm shift. Just a few years ago content was created by a relatively small number of publishers and directed to a huge number of readers. In the web 1.0 era, the standard practice was to deliver content to a passive audience. The new web – what many call the web 2.0 – has become a participative platform where content is generated by the users. The focus is now in creating social experiences with the incorporation of blogs, wikis, social networks and many other tools.

Like every revolution, clashes are due to occur. Such is the case of the Associated Press (AP) versus bloggers. In the summer of 2008 the AP wanted to charge fees on quoted text and the result was a PR fiasco after the blogosphere found AP claim to be ridiculous (more here).

Old media, in order to survive, has to embrace change and converge with new media. A good example of this is how many old media networks are leveraging the power of the web to promote their content as noted in Laura Holson’s article in the NYT. Many of their TV shows are posted online few hours after they have been broadcasted on TV. Another successful example is Hulu.com, which is a joint venture between NBC and FOX, and has a great collection of TV shows available to watch at any time.

Also fueling new media is the proliferation of handheld devices and improvements in the wireless networking infrastructure, both of which are making the consumption of media ubiquitous. An example of this is the iPhone, which has available applications that stream live video.

Welcome

This blog will contain all my work related to the Principles of New Media class (CIS 3810).