THE INFLUENCE OF SOCIAL MEDIA INFLUENCERS ON INDIVIDUAL INVESTMENT DECISIONS

Abstract

In today's digitally interconnected world, social media has emerged as a powerful tool influencing various aspects of individuals' lives, including their investment decisions. This research report delves into the intricate relationship between social media influencers and individual investment choices, while also scrutinizing the potential for manipulation inherent within this dynamic. The study employs a mixed-methods approach, integrating qualitative analyses of social media content and quantitative assessments of investment behavior. Through an extensive review of existing literature, the report establishes a theoretical framework elucidating the mechanisms through which social media influencers wield influence over investment decisions. Additionally, it explores the psychological factors driving individuals to trust and follow these influencers, often to the detriment of their financial well-being. Empirical data gathered from surveys and interviews provide insights into the extent of social media's impact on investment behavior, uncovering patterns of reliance on influencer recommendations and the subsequent outcomes on investment portfolios. Moreover, the report examines instances of potential manipulation wherein influencers exploit their authority to promote certain investment products or manipulate market sentiments for personal gain. Critical analysis of regulatory frameworks and ethical considerations surrounding influencer marketing in the financial domain informs recommendations for mitigating the risks associated with undue influence and manipulation. Proposed strategies include enhanced transparency requirements for influencers, investor education initiatives to foster financial literacy, and regulatory interventions to curb deceptive practices. Ultimately, this research contributes to a deeper understanding of the complex interplay between social media influencers and individual investment decisions, shedding light on both the opportunities and challenges inherent within this phenomenon. By addressing the potential for manipulation, stakeholders can work towards fostering a more informed and resilient investment landscape in the digital age.