What Trump and Musk Have Taught Us About Twitter

Social media best practice in financial services

Stuart Fieldhouse, Managing Director, Hawksmoor Partners
Originally published in the October 2018 issue

Social media has become a major consideration for fund managers looking to embrace a communications strategy that will put their name – and their funds – in front of possible investors. Yet for those who are not regular users, it can be tough to decide when to use it, and more importantly, when not.

Up until the election of Donald Trump as President of the United States, there was still a high degree of scepticism among C-suite executives about the value of social media platforms. When Trump was sworn in as president, there was an assumption within Washington DC political circles that he would yield his Twitter account to communications professionals who would integrate it into the wider public relations suite of the White House.

As it turned out, Trump was too attached to his Twitter account to yield it to others and has steadfastly employed it as a major communications tool to talk directly to the electorate. It is the first time the head of state of a major global power has used social media in this way, without the filter of the media or a communications team to water his statements down.

It has resulted in numerous gaffes and diplomatic blunders for the White House, many of which could have been avoided, but what it has also done is elevated Twitter in the eyes of CEOs from ‘something my daughter uses’ to a legitimate communications tool.

Musk’s first tweet since the settlement was a cryptic reference to a 1990s rap single which has many analysts wondering if he is still trying to talk about Tesla strategy by way of veiled references.

In most larger fund managers, corporate Twitter and LinkedIn accounts are carefully managed by in-house communications professionals, but some CEOs now like to also use their own Twitter accounts to communicate with the wider world, possibly inspired by Trump. Usually these are also managed by someone else, in accordance with the firm’s communications policy, but not always.

In 2014 Twitter itself famously stumbled when then-CFO Anthony Noto sent out what he thought was a message to an individual about a possible acquisition (using Twitter’s direct messaging facility). Except Noto blundered by sending the private message out on general broadcast. Luckily for him he did not name the acquisition target, but the Twitter feeds of listed company C-suite executives are now routinely monitored by journalists, analysts and hedge funds. It could have been a lot worse for Noto.

Which brings us to Elon Musk. CEOs of Silicon Valley companies have been much more prolific users of social media than their asset management counterparts, but Musk, CEO of a listed company, has demonstrated casual disregard for regulations, leaving him in hot water with the SEC. He inferred on his Twitter account that he had corporate funding for an enormous buy out, in turn leading to an SEC investigation, as this has influenced the Tesla share price.

Tesla settled with the SEC at the end of September, and one of the SEC’s conditions here has been that Musk’s Twitter account be supervised – i.e., integrated into the Tesla communications suite where others can also keep an eye on it and approve broadcasts. Musk’s tweets will be even more closely monitored now, and his first since the settlement, sent on 1 October, was a cryptic reference to a 1990s rap single which has many analysts wondering if Musk is still trying to talk about Tesla strategy by way of veiled references.

The terms of Tesla’s settlement with the SEC had still to be approved by a federal judge at the time of writing, but this does not seem to have stopped Musk from getting back on Twitter at the earliest available opportunity.


In 2017 EY estimated that 27% of hedge funds are already using, or planning to use, Twitter and other social media platforms as a source of market intelligence.

Hedge funds and Twitter

With so much information already being broadcast on Twitter it comes as no surprise to find that numerous hedge funds are using Twitter as an additional source of market intelligence. In 2017 EY estimated that 27% of hedge funds are already using, or planning to use, Twitter and other social media platforms as a source of market intelligence. Part of the value is finding indicators of potential market moving events well in advance. This will not be as blatant as some of Musk’s broadcasts, of course, but it does illustrate there is strategic value in being able to read the tea leaves of Twitter. A good example of this was the monitoring of Twitter communications by Chilean miners’ unions, which helped to tip some commodity hedge funds off about an impending strike earlier this year.

Hedge funds are bound by regulatory restrictions about what they can openly broadcast on Twitter, just as Musk is. But that does not stop some hedge fund managers from making skilful use of the medium to keep press and investors informed about their thoughts. There is something to be said about illustrating your intellectual capital to the market, where it can reinforce your brand. Major names in hedge funds that have ventured out into Twitter include Ray Dalio (@RayDalio), founder of Bridgewater Associates, Jeffrey Gundlach (@TruthGundlach) of DoubleLine Capital, John Hempton (@John_Hempton) of Bronte Capital, and Mark Dow (@mark_dow). The list of big names is too long to print here.

Twitter is a good way to gather quite a considerable following, which will include current and potential investors. If hedge funds can recognise Twitter as an interesting additional source of information, so do investors.

Good housekeeping for Twitter

Having designed and built Twitter strategies for a number of companies, we have evolved a play book of best practice which can help firms go some way towards implementing an effective policy.

Firstly, make sure all your employees, regardless of who they are, are aware of the implications of talking about their work on social media. Many employees within even larger firms are still not being briefed on social media use and can easily inadvertently communicate confidential information to the world at large. Sometimes this information may not seem that sensitive to them, but to the right parties can be extremely valuable.

Secondly, identify who the firm’s official spokespeople will be – namely, those who are authorised to use social media in the name of the firm. One solution is to set up an account for the company and assign it to those individuals authorised to tweet. Generally speaking, it is not a good idea to give your CEO free reign on your Twitter feed, as I hope I have illustrated above. Ultimate control should rest with whoever is responsible for marketing/press relations.

In some cases it can be useful to have multiple accounts covering different divisions or product lines – for example, one of my own clients has both fund management and wealth management subsidiaries which face quite different audiences. To keep messaging compartmentalised, we have decided to use different accounts.

Finally, if you are a regulated firm, then it is important to get buy-in from your compliance team. We have had numerous discussions with compliance officers about social media, and many remain terrified of Twitter. Compliance is what sets fund managers apart from many other industries when it comes to Twitter usage. Convincing compliance officers about how Twitter can be a useful marketing tool comes down to establishing policies and guidelines they can be comfortable with and which can be consistently applied. Written guidelines within the compliance manual covering social media are essential.