Social trading network eToro has introduced a new portfolio named SocialSentiment that provides retail investors with exposure to US-listed firms with strong environmental, social, and governance (ESG) practices.
The new portfolio was created in collaboration with Sentifi, an AI-powered alternative data engine that analyzes more than two million news and 500 million tweets per day to gather timely trading signals. Sentifi evaluates over 50,000 instruments, including stocks, funds, indices, currencies, and commodities. It assigns a “sentScore” to a given asset by analyzing market sentiments associated with it, enabling the creation of a portfolio, such as SocialSentiment, that tracks companies with favorable social chatter.
Dani Brinker, Head of Investment Portfolios at eToro commnented:
eToro pioneered social investing and showed how the power of social can empower people around the world to build their wealth and take control of their finances. With this portfolio, we aim to offer retail investors exposure to stocks that are being discussed in a positive light on social and digital channels, adding an extra layer of insights. We are looking forward to partnering with the Sentifi team, and working together to harness the power of social networks.
The allocation, which is based on ESG and social sentiment criteria, is rebalanced every month and comprises the top 10 S&P 500 stocks ranked by their lowest risk over attention-weighted sentiment score (AWSS). With a minimum investment of USD 500, investors can monitor their portfolio’s performance using eToro’s advanced tools and charts and stay informed about sector developments through its social feed. The portfolio is presently unavailable to US investors.
Marina Goche, CEO at Sentifi said:
The events over the past several years relating to the meme-stock rallies are evidence of how the herd can change direction, and where these changes happen, which is largely in social networks and forums. Social networks, news, blogs and forums are also a valuable source of changing risk for asset classes and offer dynamic views on ESG performance appreciation and degradation for companies globally – essential for constructing portfolios that outperform a benchmark. Sentifi is delighted to partner with eToro to offer eToro’s Social Sentiment portfolio.
eToro revealed last week it has gained approval from New York State Department of Financial Services (NYDFS) for money transmitter license and virtual currency license, also known as BitLicense. Earlier this year, eToro also announced launching a new AI-powered portfolio, InvestorAI-US, which provides investors with exposure to 12 high growth US companies.
