Financial advice on social media is attracting hundreds of millions of views, but a new analysis by Legalaes found that a significant portion of the content carries misleading signals and is produced by creators without demonstrable financial qualifications.
The study conducted by the legal and regulatory consultancy headquartered in Tallinn, Estonia, analysed 1 764 English-language finance-related videos across YouTube, TikTok, Instagram and Facebook, collectively attracting 692.6 million views and 34.8 million likes.
“The study found that 29% of the videos were classified as misleading under its criteria, while misleading content attracted substantially more views than content without those signals. Misleading videos received an average of 555 547 views each, compared with 326 170 views for the 1 253 videos classified as non-misleading.”
The research also found that only 2.2% of the 1 266 unique financial influencers (finfluencers) behind the sampled videos had demonstrable relevant financial qualifications.
YouTube shows highest risk
According to the study, YouTube recorded the highest proportion of misleading financial videos, with 41.8% of sampled videos classified as misleading.
Instagram followed at 26.8%, while Facebook and TikTok recorded 23.3% and 23%, respectively.
TikTok followed with 36.3% accurate content, compared with 32% for Instagram and 28% for Facebook.
“However, YouTube presented a more complicated picture. Although it had the highest proportion of misleading content, it also had the highest share of videos classified as providing accurate financial advice, at 38.3%.
“Across all four platforms, 34.4% of the sampled videos were classified as accurate, while 3% contained inaccurate or potentially damaging financial advice,” notes the study.
Legalaes classified 1.1% of the videos as inaccurate and 1.9% as potentially damaging.
In terms of the research methodology, Legalaes says it used rule-based text analysis of video descriptions, titles, transcripts and creator identifiers rather than manual fact-checking.
A video was considered misleading if it included one or more risk signals, such as promoting a paid product or service, suggesting a specific return or investment amount, guaranteeing returns, or containing inaccurate or potentially damaging advice.
A video could therefore be considered accurate, while still being classified as misleading if, for example, it provided sound educational information but also promoted a paid product or used guaranteed-return language.
Few creators are qualified
The study found a significant gap between the popularity of financial content and the credentials of the people producing it.
Only 2.2% of the sampled finfluencers had demonstrable financial qualifications, including credentials such as certified financial planner, chartered financial analyst and certified public accountant.
YouTube had the highest proportion of qualified creators at 5.1%, followed by Instagram at 1.6%, Facebook at 1% and TikTok at 0.7%.
Legalaes also found that only 11.7% of the videos included a disclaimer either within the content, or on the creator's profile.
“The lack of a disclaimer was measured separately from whether content was misleading, meaning a missing disclaimer alone did not cause a video to be classified as misleading.”
The risk also varied considerably according to the type of financial content being produced.
The category of trading tips and technical analysis had the highest proportion of misleading videos, with 40.6% of the 143 videos. Only 9.8% of these videos were classified as providing accurate advice.
“By comparison, financial literacy education recorded an accuracy share of 57.8%, while stock market basics stood at 45.4% and [the category of] market news and trends at 43.2%. Legalaes also found that only 0.7% of finfluencers producing trading tips and technical analysis content had demonstrable relevant qualifications,” notes the report.
At the same time, 36.4% of creators in the category promoted paid products or services, the highest share among the content categories analysed.
What investors should check
Legalaes says consumers should examine financial content on social media critically rather than treating popularity or engagement as evidence of credibility.
The research recommends checking whether a creator clearly states their qualifications and whether those qualifications are relevant to the financial information being provided.
“Consumers should also look for disclaimers, examine whether commercial relationships or conflicts of interest are disclosed, and be cautious about claims that guarantee returns or promise specific investment outcomes.
“Consumers should also consider whether advice is grounded in established investment principles, rather than encouraging potentially harmful behaviour or making unreliable claims.”
Legalaes further recommends that retail investors should scrutinise potential conflicts of interest and assess claims against established consumer-protection principles.
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