Of all the apps on Facebook, here is one that might actually make you money—depending on how smart your friends are. Cake Financial, a social finance site that lets you track and share the performance of your actual brokerage accounts, just launched its Facebook app. The app lets you compare your real stock-picking prowess to that of other Facebook members who install it on their profile pages. These are not fantasy portfolios. They show your actual returns in percentage terms (no dollar amounts are revealed), and let you compare your returns with that of your friends across brokerage accounts. Every time you or a friend makes a trade, it shows up in your feed. Talk about timely information.
Cake Financial launched at the TechCrunch40 conference last year. Since then, nearly 10,000 members have signed up who track portfolios collectively worth about $1 billion. CEO Steve Carpenter hopes that Facebook will help Cake Financial grow faster.
The potential power behind Cake—as with other social finance sites like Covester, SocialPicks, and Motley Fool CAPS—is the ability to follow the best stock pickers no matter who they are (amateur or pro). Carpenter has plans to create exchange-traded funds (ETFs) that mimic the portfolios of each of the top five percent members on Cake. It would be a personal ETF. He is still working through the details. But imagine if one of your friends on Facebook was in that elite group and you could automatically start trading alongside him. Would you do it?