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A tool has been launched to help investors understand how publicity can influence their decision making City regulator.
The Financial Conduct Authority (FCA) worked in partnership with behavioral science consultancy Influence at Work to create the “Hype Type Revealer”.
The tool, designed for mobile use, mirrors the group chat-style discussions investors have with their peers.
Users view fictional messages that contain conversations about investment opportunities, creating the experience of a real group chat discussing the latest “hot stock” tip.
steve martinThe CEO of Influence at Work said: “The number of investors attracted by the promotion is worrying.”
The tool is part of the FCA’s InvestSmart campaign which encourages people to make better-informed investment decisions that are best suited to their financial circumstances and attitude to risk.
Responses entered by the user indicate whether their “promotion type” is a calm, informed or rational investor and, upon completion, users are taken to the InvestSmart website to complete training involving investment-based tasks.
Calm This is defined as not giving context to the urgency of promoted investments; Informed is seen as examining information about investments; And rational is defined as doing due diligence rather than going with instincts.
The Hype Type tool can be accessed by FCA on the website fca.org.uk/investsmart/hype-type-revealer,