Invest in Stocks by Phone?

Brand new investors are using their smartphones to buy and sell stocks. What are the trade (offs).

Robinhood is a site to buy and sell stocks. Three smartphone screen shots are shown, which mimic how a real trade would take be placed.
Robinhood trading platform

Dear Ms. Smartphone: You mentioned an investment in last week’s column so I decided to write you about that. I am finding myself with a lot of time on my hands, and not a lot of cash since I was laid off from construction in March. I opened up an account with a brokerage account that trades stocks and they have a no-fee policy. So, I log in there to buy and sell stocks. My wife says I am spending too much time on my phone, but I think that I am learning something new, and hope to make some spare cash on the side.  A.J., Alameda

Dear A.J.   You are not alone as thousands of new “retail clients” (industry talk) have jumped on the trading bandwagon during this crisis. You only need a brokerage account and a smartphone to get into the market.

One reason is that without sports to wager on, bettors have turned to day trading. Both professional and recreational gamblers are now in the stock market, according to Sports Illustrated. Once these traders are able to return to their regular activities, remember a quote from the venerated investor Warren Buffett: It’s only when the tide goes out that you learn who’s been swimming naked.” (source: MarketWatch).

Invest in What you Know!

The other reason people are investing is that, like you, they have time, and need cash. DearSmartphone is not certified as an investment advisor, but she is on solid ground when she recommends that you do your homework, invest in companies or industries that you know something about (home builders? construction? materials?), hold a diversified portfolio and don’t put up the money you would normally use to pay the rent.

A concern, as your wife notes, is the time you amass on your phone now that you’ve become a stock trader. In recent times, but before smartphones, a stock broker (i.e. the certified investment advisor!)  would spend all day, at a desk, on a computer, following the market and individual stocks for clients. With changes in technology, everyone can now be their own stock broker, and move in-and-out of the market with lightning speed. 

The Social MediA of Wall St.

This new trading environment is volatile. It seems chaotic and it is susceptible to “fake news” and rumor. When it comes to investment tips, ads can be bought, ideas can be planted on social media or in newsletters, and CEO’s can spin speculative but hopeful stories. Any of these messages will rapidly diffuse into the larger information mainstream that investors, like yourself, tend to read or see. Those sources, not necessarily the underlying financials of the company, may swing the stock, options, and futures market up- and -down in micro-seconds. 

So, do use your smartphone to keep on top of the message stream and identify whether the sender and the story are credible (the research I mentioned). The Securities and Exchange Commission notes (2015) that social media can provide benefit for investors, but is also presents opportunities for fraudsters to engage in market manipulation or “pump and dump” schemes. It’s almost  like reading email: you are less susceptible if you know how to identify the spam and get rid of it.

As you spend more time on your phone with your stocks, I encourage you to ask if this is how you want to invest your two most precious resources: these are your time and your attention. You are channeling them to your device so make sure you enjoy the ride!

Zoom Fatigue: How to Overcome

A whiteboard is shown and for each day of the week, scheduled online meetings on zoom or facetime.
Zoom Fatigue! Photo Illustration: Dave Cole/WSJ

Dear Ms. Smartphone: After a meeting or two on Zoom, and even a catch-up with girl friends, I am zonked out. Sometimes I skip meals because I feel so fatigued and crawl into bed. It’s just the opposite for my son, who is now home from college. He goes on Zoom in the evening with his friends, and stays on it for hours. Then he’s spry and awake! Is this an age thing or something else?  Rupa, Berkeley

Dear Rupa: A lot of parents are asking the same thing. For elders, it’s an age thing because we did not come of age in the time of zoom. And, the two-way technology is still evolving so there are lots of asynchronous moments and dropped connections to challenge our patience. In a previous post I noted how our physical communications depend on being able to interpret very subtle non-verbal cues like an upturned smile, the twitch of an eye, or the flick of the hair. Most of these cues are at a subliminal level. Zoom meetings, as well as informal chats with our friends, can be stressful for those of us used to processing our social cues differently. 

The Lack of Multitasking

Like you, I find video chats to be draining but for an additional reason; it’s the absence of multi-tasking. When you phone me, say on a voice call or text, I might be doing other things….but you can’t see that.  We have gotten used to being mobile and doing lots of (other) things when we have 2 way communication. That level of distraction works most of the time, but not in the car. Focusing for an extended time on the red dot of the camera feels like I am in line-up in a police station (not that I will confess to that!)

Search for Best Zoom Games

When your son goes on Zoom and feels spry afterwards, that’s because he engages with his friends and content, in an entirely different manner. There are lots of third-party sites to link to, The list of games is long…but familiar. Search for games to play on Zoom: you’ll find Monopoly, Battleship, Pictionary, Guess Who, and many many more. Then there are the ‘Drinking Game’ versions, like Battleship with shot glasses….you get the picture! And, to my point about multi-tasking, just one kid needs to be on a computer. The rest can join in on their phones.  That means that they do not have to stay stationary, with eyes glued to the red dot. They are probably moving around the room, browsing other screens, and, of course, eating and drinking.

THINK LIKE A TEEN

In these times of quarantine, I would encourage anyone to try out these games with an old established  friend and picture yourself as a young teen. Experiment together. Put it this way: Imagine that it was 1915 and your family had just installed a new Bell phone. You were advised to use it only for emergencies or something urgent. Now fast-forward to 1960, and you are a teen, able to spend hours after school conversing with friends on Bell phones. My point is that technology changes over time, and what is once serious business morphs into social play.

Quibi Good For Phone?

Would Quibi be a good thing to add to my daily phone routine?

Dear Ms. Smartphone: My phone and I are inseparable this month! So, I was wondering would ‘DearSmartphone’ add Quibi to the daily routine? My girlfriend finds the videos entertaining and watches them regularly during Quibi’s free trial. I am worried that if I start using watching it could become addictive and I will be spending yet more time on my small screen. Jacob, Mill Valley

Dear Jacob: When Quibi offers Dear Smartphone a contract for a live weekly show, I will surely be encouraging you to watch it regularly. For those who have not heard, Quibi is a platform that provides TV-like content in attention-grabbing eight to ten minute mini bites for phones. It is a large expensive arranged marriage between Hollywood and Silicon Valley.

To answer your question I downloaded the free version of Quibi with ads. There was no opportunity to onboard and the content jumped to a slick ad for Pepsi Lite . Then I was shown an eight minute thriller about a blond haired lady from LA, driving Uber, texting as she drove. Quibi certainly got my demographics and interests spot-on, but it was a real no-no in 2020 to depict someone so clueless to text while driving. An old-fashioned out-dated view.

Since Quibi had my interests pinned, I wondered if Quibi had access to my digital wallet and receipts? Would they know if I purchased Pepsi Lite or a similar beverage? Here Quibi could find its Orwellian moment: a perfect tracking vehicle for advertisers. I watched more content and found, like your girlfriend, that some of it was entertaining- a fast video version of People magazine. I often liked the ads more than the show, just like Super-Bowl ad trailers.

But, your question about addiction and spending more time on the phone is the real issue. Recall the wit of Marshall McLuhan who coined that ‘the medium is the message (or massage).* Since the very start Bell Phones have been used for two-way communications, business, and relationship building. We continue that convention today through Instagram, Facebook, text, and voice. Quibi, meanwhile, plays like a throw-back to one-way cinema.

There’s already a video competitor called Tik-Toc. Not yet my skill-set but it is said to make video on the phone two-way, interactive and “fun”. So, read the review from TechCrunch, and first decide how you want to allocate your time. Then, if you wish, sharpen your video watching, video producing skills.