Cake Financial is a new service for helping any stock market investor better manage their own performance.
The San Francisco company lets you import all of your financial data from online brokerage firms into your Cake profile, then compare your performance against other investors using the service.
Cake shows you the historical performance of your portfolio going back as far as ten years, as well as monthly and yearly performance data. You can compare yourself versus friends and family, as well as against stock indexes, or against top investors on Cake.
The service hides each individuals’ net worth, number of shares owned, and other data. You can only see what stocks people have invested in, and when, and how those individuals have performed versus the market. If desired, you can use a fake user name to disguise your identity. (See screenshot below.)
Hedge funds and mutual funds don’t normally provide this level of data analysis; hedge funds also report quarterly results a quarter later. Cake data is live, and lets you import from established sites such as E-Trade or Charles Schwab.
You can also choose to follow other investors, and see what they’re buying and selling from when you log in. Even in testing, the site is already revealing top investors — some of whom didn’t know they were better than their peers until using Cake, the company tells us.
A wide range of other features let you search for and follow users based on strategies, industries and other factors.
Recent studies, such as this one (pdf) by the Harvard Business School, have concluded that especially skillful individuals take advantage of “market inefficiencies” to make more money than everyone else.
Less-stellar investors are already learning from outstanding individuals on Cake, the company says — notably recognizing how a lack of diversity in their portfolios exposes them to extra risk.
So why would top investors join, and let Cake show others their strategies? Bragging rights and public affirmation, of course. Many Cake users are savvy enough at investing that they’re already handling investments for family members and friends, the company says.
Other sites, like Stockpickr, let users pick stocks they would invest in — a different concept from comparing real investments between established individual investors.
Investors include Alsop Louie Partners, Ron Conway/Baseline Ventures and others.
Screenshot of public rankings of investors on the site: