The Changing Face of Financial Technology in the Stock Market

A New Breed of Tech Companies Will Make You a Smarter Investor.

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Financial change is coming, and it is good.

This is the second in a series of articles which explore some of the new fin-tech companies that I saw present recently at the Stocktoberfest conference in Coronado, California put on by StockTwits and Howard Lindzon.

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Wealthfront

The marquee name in the robo-advisor space, Wealthfront launched in 2011 and has experienced incredible growth amassing over $1.5 billion in funds under management.  CEO Adam Nash tipped his hat as to why Wealthfront is different when he noted that he hired the team from Facebook's to build his site, instead of from some financial site.

What is so revolutionary about the company is that they claim that because of efficiency brought about by technology, they can manage a $100,000 portfolio of stocks for less than twenty dollars per month.

They also have a very slick and intuitive interface that lets customer track, manage, and adjust their holdings as they see fit.  And if they need more financial advice, Wealthfront has the ability to offer that as well for a small additional fee.

FundSeeder

Backed by legendary market reporter Jack Schwager, FundSeeder is solving an interesting problem. In theory there are plenty of traders and investors who operate outside of the traditional Wall Street machine and who produce better returns that their NYC counterparts.  The problem has been connecting those people up with potential investors.

FundSeeder is creating a platform when individuals can connect up their brokerage accounts and have their trading data pulled in order to create a performance report in real-time.

 Traders are then ranked using a number of different metrics -- some of which are proprietary -- and then displayed on their leader board.

This part is nothing new, but what is new is that investors -- those willing to place money with individuals -- can now find these outperforming traders and fund them.

 If FundSeeder pulls this off it will truly make the world of money management more democratized.

Two Margins

For a guy who does not do any fundamental analysis, I have to say that the product built by Two Margins is pretty darn cool.  What they allow you to do is pull in 8-K's -- or earnings announcements -- by publicly traded companies and then annotate them.

But the cool part is that Two Margins then harnesses the wisdom of crowds by sharing that document with their whole community.  What you get then is a very well parsed set of annotation by some of the smartest investing minds.  This allows you to see how your analysis compares with that of others.

What is really going to be a game changer though is when the company is able to pull in any and all SEC documentation for review.  Image how much easier it will be to wade through and analyze a company’s fillings when you have not just one, but one thousand pairs of eyes scrutinizing every single line of a 10-K filing to see if there is some hidden nugget of information that would lead you to buy (or sell) the company's stock.

In my next article I will continue to highlight some of the best fin-tech companies who presented at the conference and show you how they can help you be a better -- and more profitable -- investor.

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