An Amazon engineer gave random people on Twitch $50K to invest — and this is what happened
A long-standing rule for preserving one's sanity on the internet is to never, ever read the comments section. Amazon engineer Mike Roberts had a different idea: What if he let the comments section pick his investment portfolio?
After six months of tinkering, he has now released his invention: Stock Stream, which Roberts is billing as "the world's first multiplayer stock market game that uses real money." As of last week, anyone with an account on the game-streaming site Twitch could log-in and help allocate $50,000 of Roberts' money by typing stock symbols into the Stock Stream's comment section.
Roberts says he got the idea from watching Twitch users collaborate on games like Pokemon Go. As more and more Twitch-ers started using the platform to crowdsource ideas, Roberts got the idea to see how that crowdsourcing might be used for more practical activities, like choosing what stocks to invest in.
"I wanted something that would interface with the real world," Roberts said. "You’ll go to a news site, and you’ll see a guy saying AMD is a good stock. And then five minutes later they’re saying to sell." (AMD is a microchip company.)
Roberts elaborated that with the stock market, expertise didn't seem to matter that much: On a given day you have qualified-looking talking heads arguing both sides of a given issue. Since the stock market follows a kind of mob mentality anyway, actually having a mob weigh in on which stocks he should buy might not be all that nonsensical: "I kind of figured that it would be kind of a diversified portfolio to some extent."
"Diversified" is a stretch — as Mic has written before, a properly diversified investment portfolio will have other asset classes in them besides stocks. But since launching on May 30, Roberts' account made about $700 trading stocks on the platform Robinhood — a gain of about 1.4% while the market as a whole gained 1% for the week.
A spokesman for the company wouldn't confirm or deny the trading activity, citing regulatory reasons, but didn't deny any of Robert's story either.
So what are the commenters investing in? Mostly stock in technology companies, with a few joke trades thrown in: "We're seeing lots of Tesla, Google, AMD and seeing some that are just funny," Roberts said. "Today people were trading CAKE, the cheese cake one," he said, referring to the Cheesecake Factory, whose company stock trades under the symbol CAKE.
Commenters pick the investments by voting on them: As you can see in the bottom-right corner of the image above, commenters voice their preferences by typing an exclamation point followed by the trading action (buy or sell) and the ticker symbol (stock market abbreviations).
So, if you thought Roberts could use some McDonalds in his portfolio, you'd vote by typing "!buy MCD." A line of code keeps track of the votes, and executes the most popular trade every five minutes. Since it can only do one trade of one share every five minutes, it'll take a while for even the most passionate troll to fritter away too much of Roberts' money: "I’ve done simulations with random data and even taking worst case scenario, you have a realized loss of $100 a day."
There are obviously still a few safeguards. If the account balance falls below $25,000, for example, trading on the account will stop automatically due to FINRA regulations on day-trading. Roberts has also manually blocked a few types of securities, mainly highly-leveraged ETFs, which use borrowed capital to take larger positions. Finally, Stock Stream won't trade Amazon, since, as an employee, Roberts could open himself to accusations of insider trading.
The project was fairly labor-intensive. Roberts said he spent about six months developing and launching, working most nights and weekends to pull it together. He used GitHub, the popular coding repository, to pull the code for Robinhood's application program interface. Once he had that, then he was able to integrate Robinhood into Twitch, which allowed him to link Twitch comments with actual stock trading.
Though it's just a game for now, Roberts says he has bigger plans for the platform. He would like to figure out a way to score voters, so that the better stock pickers carried more weight in determining his allocation, although he says he's having trouble working out the kinks.
"The scoring has been a complete disaster, the code has just not worked out well. So that needs a lot of work," he said. "But for now people seem to be having fun."
Of course, there may also be a little money in it for him too. Software developers and coders are known for pursuing ambitious side projects that, on occasion, turn out to be million-dollar ideas or, at the very least, help draw some attention to their skills.
Finally, Roberts also embedded his Robinhood referral code on the page, so anyone who clicks through and makes an account of their own nets him a free share of stock. A spokesman for the company told Mic in an email it's a new promotion they're trying out in lieu of their typical $10 referral bonus.
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