Institutional Investors Are Using Reddit to Make Investment Decisions. Here’s Where They Lurk.

And it’s not just Reddit — digital media from newsletters to TikTok are also playing a role.

Bigstock photo

Bigstock photo

At long last, the Reddit retail investors may finally be enjoying their day in the sun: Major institutional investors are taking note of what they do — and they’re making investment decisions based on it.

A new survey shows that 58 percent of the institutional investors polled have made an investment decision based on information they found on Reddit.

Since 2020, when retail trading began to take off, the social media forum site has become a haven for retail traders interested in both meme stocks like AMC and plain vanilla passive investing.

The Brunswick Group surveyed 257 institutional investors in North America, the United Kingdom, and the European Union about how they use social media and other digital tools to inform their investment decisions. The majority of the respondents — 94 percent — were either portfolio managers or buy-side analysts.

“It’s kind of impressive year over year, not only how much they’re absorbing the information, but also [that they’re] making decisions based on it,” said Janelle Nowak-Santo, a partner at Brunswick.


The survey pointed out a convergence between institutional and retail investors, with institutions tapping into sites like Reddit and traditionally retail-oriented newsletters and podcasts for information.

In fact, according to the survey, 49 percent of respondents consider Reddit to be of “high importance” when it comes to evaluating a stock. This result is similar to TikTok’s ranking, and trails sites like YouTube and Instagram by about 10 percentage points.

“There’s an inundation of information from all sources,” Nowak-Santo said. “I’d have to guess that in order to be prudent in their research, they’re actually using more of that information to make their decisions.”

So where on Reddit are these investors finding this information? The survey showed that popular investor subreddits include r/investing and r/cryptocurrency, with over half of all respondents saying that they follow those forums. Others that are commonly referenced include r/WallStreetBets and r/personalfinance. And their popularity may grow in the months to come, with 46 percent of respondents saying that they plan to increase their use of the platform.

“I think that’s just another interesting insight that [shows that] this gap between institutional and retail is narrowing,” Nowak-Santo said.

But Reddit is less important when it comes to data harvesting via machine learning, AI, and natural language processing. Just 23 percent of those surveyed said their firms are harvesting data from the social media site.

Google search results, perhaps not surprisingly, are the most popular place to harvest data. YouTube, however, ranks second, with 47 percent of investors tapping into the video platform’s data.

The survey also showed that investors are turning their focus from traditional mediums to newsletters and podcasts. In fact, 61 percent said they plan to increase their use of e-mail newsletters for equity evaluation in the coming year, while half of respondents said the same for podcasts.

These platforms are also considered to be more trustworthy than social media, ranking fourth and fifth, respectively, among those who took the survey, after investor relation sites, Google, and LinkedIn.

Among those surveyed, the Robinhood Snacks newsletter was most popular, tied with Value Investor Insight. Meanwhile, The Economist’s Money Talks is the favorite podcast among investors, with Invest Like the Best trailing close behind.