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This was revealed by BrokerChooser, which noted that financial influencers, also known as “fin-fluencers”, significantly influence retail traders’ decisions.
Notably, 33% of forex traders are said to have been influenced by finfluencers to make trading decisions, and 49% of consumers depend on finfluencer recommendations.
New research from the forex broker experts at BrokerChooser has uncovered that up to 80% of forex advice given out on TikTok from ‘influencers’ could be potentially misleading.
The experts analysed 100 of the best-performing TikTok videos across a range of forex topics to uncover the scale of misinformation.
What they uncovered was alarming, from a major lack of disclaimers to a high volume of videos focused solely on flaunting wealth and lifestyle, with little to no trading context.
The research revealed that only 6% of forex advice on TikTok encourages viewers to do their own research. Overall, the analysis revealed that a staggering 80% of forex advice on TikTok was potentially misleading.
Only 6%, or 3 in 50 videos, encouraged viewers to do their own research. Interestingly, of the top-performing videos, 60% of content came from male fin-fluencers.
Female fin-fluencers were behind 35% of top-performing videos, and 5% were from unspecified or AI-produced content.
According to BrokerChooser, only one in seven videos, or 13%, analysed included relevant disclaimers, such as clarifying the risks involved in forex trading or stating that the content was not financial advice.
This lack of transparency is particularly concerning, given that one in five videos was actively promoting or selling a product or service. This raises ethical concerns about the motivations behind the content being shared.
TikTok’s forex advice puts viewers at risk
Disturbingly, the forex broker experts at BrokerChooser uncovered that half of the forex-related content on TikTok (50%) was fin-fluencers boasting about their money made or their lifestyle with no relevant or trading context.
Only 9% of videos which included brags about money or lifestyle came with context as to how they achieved it.
Additionally, less than a quarter (23%) of forex-related content on TikTok contained actual forex trading information. Instead, videos often focused on lifestyle imagery, vague motivational claims or promises of quick wealth.
This was often done without disclosing risks or by creators without verifiable credentials, creating a misleading impression of forex trading as a guaranteed route to financial freedom rather than a complex, high-risk activity.
“The findings of our study are deeply concerning as they shine a light on the overwhelming majority of forex-related content on TikTok as potentially misleading or harmful,” said BrokerChooser’s content editor head, Edith Balazs.
“The research uncovered that very few creators encourage their viewers to do their own research or provide any meaningful trading information.”
Instead, the platform seems saturated with individuals flaunting their wealth and lavish lifestyle without offering any transparency or context, which could leave viewers vulnerable to false expectations and financial risk.
“This is particularly concerning as a recent SEC report suggested that around 70% of retail forex day traders lost money each quarter, and two out of three forex customers lose money overall,” Balazs said.
Balazs explained that TikTok is not the place to start if you’re serious about learning to trade. Forex education should not come from fin-fluencers trying to sell you a dream.
Instead, investors should find reliable trading information from regulator-accredited sources, such as financial institutions, professional trading platforms, or certified training providers.
“Always practice due diligence: question the source, verify credentials, and never take financial advice at face value,” Balazs urged.
“Critical thinking, combined with research and regulated education, is the only safe way to approach financial markets.”
This article was first published by Daily Investor and is reproduced with permission.
Issued on MyBroadband by Kirsten Minnaar | https://mybroadband.co.za/news/internet/597036-warning-about-social-media-traders.html
