Hedge funds purposely ignoring social media

Survey finds that hedge funds don't write on their Facebook walls and only 1% tweet

Just as more small businesses and brands are molding their social media persona on as many platforms as they can, hedge funds and their employees are purposely avoiding the online interaction.

A mere 1% of the 77 hedge funds in a recent survey were active on Twitter and none had Facebook activity, according to MHP Communications on Thursday.

LinkedIn was the big exception to the social media absence, where 79% of managers had a presence on LinkedIn, but only 23% of those had an active feed.

“The findings did not surprise us," Martin Forrest, director and asset manager for the MHP Communications Survey said in a statement. "Historically, hedge fund managers have deliberately kept a low profile and managed their reputations accordingly. They are also concerned about the regulatory implications of social media.”

Clearly most hedge funds are tightlipped by nature and social media is for those who are a fan of the spotlight, but hedge funds could run into some issues in the future if they are completely absence from the scene and the conversations.

The hedge funds that weren't there

Social media platforms are plump with consumer trends and information that hedge funds use to predict the next big thing. While a company doesn't need to have a Twitter handle or Facebook page to trove for data or conduct searches, the level of understanding and familiarity with real-time sentiment is far better when one has a presence on the space.

Clients, investors and experts are also present in great numbers on social media and creating connections and relationship is easier when you are part of the online community.

A Web survey that was released Wednesday showed that more small businesses are rushing to adopt social media to market their company and gain feedback from their audiences, 96% of small businesses now maintain a Facebook page and almost all of them have a website.

Forrest didn't see an immediate issue with lacking a social media presence in the short term, but says hedge fund managers should begin using social media more actively as it is “an emerging communications channel for hedge fund stakeholders, particularly current and future employees and clients as well as journalists in financial services media, in their work and personal lives.”

Another problem that could arise is that people could claim Twitter handles or pages that use their name and post whatever they wish -- even if it hurt the hedge fund brand. Social media such as Twitter, works on a first come first serve bases with handle names and companies should at least be grabbing their namesake to allow flexibility if they want to use it some time in the future, or just to avoid brand hijacking like Bank of America and BP have dealt with in PR issues.

According to the survey, only 4% of managers had secured their corporate name as a Twitter account.

Out of the fund managers surveyed, only MAN Investments had an active twitter feed, which it uses to tweet about a whole range of issues including “broad economic/investment views, corporate announcements, marketing events and press coverage."

Surprisingly, two hedge funds have created YouTube channels -- one using it to show short videos on economic and marketing event and the second showing speeches and industry events.

And of the funds looked at 8% still did not have a coporate website. With search engines driving much of the traffic to companies and services, businesses with more social media are more likely to capture moe traffic because each platform will rise to the top of searches and increase the likelihood of users clicking on their site.

The possibility for making more companies aware of their presence and gaining industry insight is there, but it is up to hedge funds now to find out if they want that interaction or if the risk is too great.

Image Sources -- Can-turtles-fly.blogspot.com and Wepartypatriots.com