By Jake Barach

Three investing experts’ opinions, a 74.8 percent climb, a 62.7 percent drop, multiple double-digit percentage intraday swings, several hundred PowerPoint slides and two and a half years, and Herbalife Ltd.’s shares currently trade less than 1 percent below their price two weeks before Bill Ackman began his public assault on the nutritional supplement company in 2012.

On Dec. 20, 2012, Ackman, a hedge fund manager at Pershing Square Capital Management LP, made public the details of his massive short on shares of Herbalife, sending prices down 9.7 percent on the day and 30.2 percent across four trading sessions. Within two months, Dan Loeb, founder of Third Point LLC, and Carl Icahn, founder of Icahn Enterprises LP, staked their bets on the long side of Herbalife shares. Since then, the three have written investor letters and made countless media appearances in order to defend their stance on the issue. Ackman’s failure to provide the “smoking gun” for Herbalife’s impropriety during his second, three-hour, widely-covered broadcast led to an 18 percent rise in the stock’s share price as he spoke July 22, 2014.

Though the average investor may not be sure who’s right in this situation, the swings in share prices indicate that they are clearly paying attention. The words and dollars of these three men have yet to bring to light the truth behind the company’s structural integrity and financial viability. Still, the media eye rests firmly upon them and their fellow elite investors in an effort to provide its audience with the coverage it desires, but not necessarily the coverage it needs.

“People shouldn’t be looking for reasonable financial advice for free on the Internet or their television. It’s simply kind of a ludicrous expectation,” said Jeff Macke, the founder of Macke Asset Management LLC. “But, selling ice cream is always going to be a better business than selling kale.”

The Herbalife case may be the sweetest ice cream to go on sale in recent years. In 2013, 13.8 percent of families held stocks among their assets and 94.5 percent held some form of financial asset, according to a Federal Reserve Board bulletin from September 2014. The average investor with a stake in equities and fixed-income mutual funds has earned a 1.9 percent annualized return during the past 30 years, writes Sean Hanlon of Forbes.

For this reason, it should be no surprise that investment “gurus” like Icahn, Loeb, Ackman, Leon Cooperman and Warren Buffett, who have amassed immense wealth through their shrewd and calculated stock picks, garner investor admiration. To see three of these titans go after one another, with hundreds of millions of dollars on the line, is as entertaining of an active management story as the media is going to get. There’s a highlight reel-esque New York Times timeline to prove it. But, boiling down investing into an easily digestible, “me versus you” scenario can undervalue the process that goes into assigning value to a stock.

Supply vs. Demand

Given the money at stake in, and the complexity of, the financial markets, people crave information, particularly seemingly lucrative information. Supply is valuable among this massive demand, but it is also a highly competitive space, said Macke. As with any business in search of financial success, outlets such as Bloomberg News, the Wall Street Journal, Fox Business Network and CNBC seek to provide customers with what they want. In a world dominated by financial jargon and massive institutions, recognizable, successful names often fit viewers’ tastes, and outlets are quick to comply and place these investors on a pedestal. This, however, may do more harm than good for the consumer.

Among this obsession with active management, it can become easy for the average investor to be convinced that they can and should be picking their own stocks, said Barry Ritholtz, (right) the founder of Ritholtz Wealth Management and a Bloomberg View columnist. This assumption comes despite the fact that the S&P 500 climbed 11.39 percent in 2014, and only 30 of the funds named on Bloomberg’s list of 100 top-performing large hedge funds generated a greater return on the year. Ackman’s Pershing Square International, which generated a 32.8 percent return, stands atop the list.

“Even if the investor can mimic what the pros are doing, so what?” said Ritholtz. “The guy who buys an index and puts it away is ultimately going to have lower cost, lower taxes and better performance. The only thing is, they have less to talk about at a barbeque or a cocktail party.”

Though outlets benefit financially from providing viewers access to the stars of the investing world, the relationship between the two is far from one sided. Stock picks, no matter how insightful, don’t pay off successfully unless other investors agree with the your position. As a result, most people with large stakes in the market want their voice heard, said Josh Brown, CEO of Ritholtz Wealth Management and author of “Clash of the Financial Pundits: How the Media Influences Your Investment Decisions for Better or Worse.” In the age of constant news cycles, this can cause confusion for the everyday investor.

“There’s a tremendous amount of noise and very little signal,” said Ritholtz. “You have to sift through all that noise to get through to the signal underneath.”

While the typical fund manager with an unrecognized name may court media attention and get a quote placed every so often, the outlets are clamoring for quotes from people like Icahn and Ackman, said Macke. This, in turn, provides these investors with a megaphone through which to convey their opinions.

What may, in fact, just be a particularly loud “noise” can easily be attributed as signal even in the face of limited evidence. In August 2013, for example, Icahn tweeted about his position in Apple Inc. and the notion that it was particularly undervalued. In 140 characters or less, and with the aid of a wealth of media coverage, Icahn helped shares of Apple stock rise in value by nearly 5 percent on the day.

Given his access to executives, his experience on company boards and his investing pedigree, it wouldn’t be shocking if Icahn’s statement was correct. Yet, whereas an everyday, skilled investor might see Apple as undervalued, purchase shares and then reap rewards as future investors come to a similar conclusion later on, Icahn is able to skip this process thanks to the coverage he receives and the attention he commands. He can generate profit nearly instantaneously. This influence on the markets is concerning, particularly when considering certain aspects of human nature that come into play in investing.

“There are a lot of examples throughout history where the public wants to believe that somebody can give them certainty about the future,” said Brown. “We put the guy who was just right about something on the pedestal just about every time. We almost never learn.”

The subscription to this hot-hand fallacy means that someone such as Icahn, who is often “right” simply as a consequence of having his past and his ideas becoming highly visible, is unlikely to relinquish his influence. Viewer confidence in his ability to pick stocks perpetuates the need to cover him among outlets. This coverage sways investor sentiment, generates profit for Icahn, has investors clinging to his every word and keeps the cycle going.

Tracking Billionaires

Despite the criticisms, the business world possesses a massive influence on our everyday lives. Forbes’ 2014 list of billionaires included the names of 1,645 people that have the rare, and enviable, honor of requiring at least 10 digits to describe their wealth. At Forbes, the coverage of individuals is largely limited to their impressive number and a short blurb about how it grew so large. At Bloomberg Billionaires, Peter Newcomb, an editor on the desk, and his team work to piece together the math and the stories behind the fortunes of the world’s wealthiest people.

“The way we look at it, by covering these guys, you’re covering the ultimate movers and shakers of the global economy. These guys have their hands on every aspect of the economy, whether it’s the international markets, the clothes you wear or the food you eat,” said Newcomb. “It’s hard to leave your house and go about your day without half a dozen billionaires’ fortunes getting in your way.”

The value in Bloomberg Billionaires differs significantly for those that pay upwards of $20,000 a year for a Bloomberg terminal and those who peruse the website for free, said Newcomb. The terminal users, who tend to be deeply engaged with the financial markets, turn to the desk’s work to understand how the world’s wealthiest are deploying their capital and steering their investments, he said. On the site, however, the interest is much more on par with financial porn, as readers seek an inside look at the lifestyles of the fabulously wealthy.

Some, like David Geffen, who embarked on his path to riches as the co-founder of Asylum Records, will happily speak on background and provide guidance as to how they’re investing, said Newcomb. Donald Trump, on the other hand, is Newcomb’s go-to example for someone who has a tendency to be too helpful and embellish his holdings. Still, the issue of self-promotion on the part of the billionaires resonates. Despite the range of cooperation, there is one consistency that invokes similar concerns as those regarding investment “gurus.”

“Most don’t really want to cooperate on reporting their wealth because they’re not that interested in that,” said Newcomb. “They are interested in their deal making. So, if you’re really covering their business, that’s something they’re more inclined to cooperate with.”

No Advantage

Ultimately, it’s difficult to tell how big of an impact the financial media and its coverage of investment gurus has on the ways in which its consumers invest. A general and costly misconception about the analyst reports, stories and charts that investors “research,” however, is that they can help someone vet which stocks are worth buying, said Ritholtz. The semi-strong form of the efficient-market hypothesis suggests that share prices incorporate and reflect all relevant, publicly available information.

“Unless you’re getting market moving news before everyone else, what is the advantage of reading something that’s in Barron’s, the Wall Street Journal or the New York Times if the rest of the investing world is acting on it?” said Ritholtz. “Whatever strategic benefit there is to gain from this information is lost in the fact that everyone has access to it.”

Even if investors attempt to consume financial media as a means of gauging the economic environment, rather than handpicking stocks, the impact of the recency effect, or the tendency to focus only on the most recent data points, on writers and financial media consumers can be detrimental to this effort. Markets need to be understood across time, thus analysis of a stream of data points, not a singular mark, is necessary to come to meaningful conclusions, said Ritholtz.

“A couple of years ago, CNBC used to have a clock countdown to non-farm payrolls. I don’t remember if it was tenths of a second or hundredths of a second, but it was just absurd,” said Ritholtz. “It isn’t Usain Bolt. It’s non-farm payroll, and it’s going to be adjusted next month anyway.”

This disdain for the sound bite genre led Ritholtz to create “Masters of Business,” a podcast in which he sits down for an hour with players across various industries. Instead of discussing stock picks, however, the discussions tend toward the guests’ varied expertise. Brad Katsuyama, the CEO of the IEX dark pool and protagonist of Michael Lewis’ “Flash Boys,” discussed dark pools and high frequency trading. Bobby Flay spoke on the business of the Food Network. Even here, there is some self-promotion, though it may come with a more educational tilt. This format is synchronous with Ritholtz’s belief that an investor must have a diversified set of expertise in order to be effective, but, for better or for worse, it is not conducive with the direction media is going in, said Macke.

“If you have the luxury of having a longer cycle and viewers that want to pay attention to you for 60 minutes, and you’re happy with that niche, that’s fine,” said Macke. “For the people that are craving an audience, we’re going to a three minute sound bite type of future, and you better embrace it and figure out how to be relevant in that genre.”

Though there may be flaws in financial media and the ways in which people consume it, there is no denying that it adheres to supply and demand economics, said Macke. The average investor is putting his or her money at substantial risk in an environment that is hard to fully comprehend and even harder to predict. The constant stream of speculation, data and coverage may not be worthy for investment advice, but it certainly plays a major role in comforting investors and enabling them to understand the ins and outs of the corporate and financial worlds. The business media outlets capitalize on this need, and the glut of competition has demanded that they continue to adapt the way in which they do so.

Big time investors may command more control and attention within the markets than they should as a result of the way business media’s relationship with its consumers has developed, but it’s only natural. If you’re a competitor, and everyone invested in the stock markets is to some extent, you pay attention to those that compete best.

Jake Barach is a junior at UNC-Chapel Hill studying business journalism. He interned at Bloomberg News in the summer of 2013.

By Meg Garner

Reporters laugh, joking back and forth about something they have seen or read. They are not just coworkers but friends dedicated to telling and sharing the news in a way that is both spirited and serious.

It does not seem to faze these reporters that their work could be shared across the Internet that day with millions of readers tuning in to see, click and share, but then going viral is nothing new for a BuzzFeed reporter.

Since its inception in 2006, BuzzFeed has dedicated its team to a model of tracking viral content and producing stories that people want to share, so it makes sense that the site’s reporters are familiar with writing attention-grabbing pieces.

And after two years BuzzFeed’s business desk has proven itself to be no exception to this model.

WTF: BuzzFeed and business?!?

A large majority would hedge their bets by saying readers going to BuzzFeed to find out which Disney ride they are are probably not interested in JPMorgan’s latest earnings. That same majority might also say business news is boring.

So why mix something as boring and old-fashioned as business news with the young, hip, fast-paced reputation of BuzzFeed?

The answer really is simple.

What this great majority continually gets wrong is that business news can be both. They do not recognize that a business story can be engaging solely on how the writer presents it.

For this reason, the business reporters at BuzzFeed are encouraged to do just that, fill their stories with solid, compelling business reporting with a bit of uniqueness thrown in. Furthermore, they are told not to just tell the day’s stories, but tell them in a way that differs from everyone else’s coverage.

And to BuzzFeed editor in chief Ben Smith that is the not-so-secret secret to the business section’s success.

“We’ve hired great, ambitious reporters, and always tried to tell original stories rather than to chase the (giant) crowd or to be all things to all people,” Smith wrote in an email.

This sentiment was reiterated by business editor Tom Gara who said the flexibility of BuzzFeed allows his writers to focus on only the stories they feel matter and leave other sites, like The New York Times or The Wall Street Journal, to fill in the holes.

“With BuzzFeed, our distribution method primarily is social, and we see social as this foundational thing, so we’re not under the assumption that people are coming to BuzzFeed.com or to the BuzzFeed business page to see all the business news that matters at any given moment,” Gara said. “We don’t think we’re playing at their game, and we’re not trying to play at that game.”

“We know there are places that are going to be better than us with a full page of every single news headline, and what we want to have are individual stories that are compelling enough that people want to share them and will pass them around.”

And it seems to be working.

For instance, a January story by Molly Hensley-Clancy, who covers the business of education, about how college students can access personal admission files at their college went viral with over 800,000 views. Not only did Hensley-Clancy break news with this story, beating the New York Times to it a few hours, but she also wrote a business story that attracted thousands of people’s attention.

But Hensley-Clancy said while going viral is exciting, to her it is more important that she continues to dive into her beat and gain the respect of her consistent readers.

“Well, I’m not sure we’re necessarily trying to appeal to the ‘average’ BuzzFeed reader,” she said. “Some of our stories are, but a lot of them are written for a more niche, specific audience.”

“When I write a story about an education company, I don’t expect it to go viral; I write it for the few thousand people that it will matter to, and to gain respect on my beat.”

But getting people to take a BuzzFeed seriously in terms of its news coverage was not always easy, and for one reporter seeing the team’s credibility grow has been the most fulfilling part of working for BuzzFeed.

Sapna Maheshwari left her job at Bloomberg to cover retail for BuzzFeed in 2013 when the desk was first beginning. At the time she wrote she was “extremely attracted to the opportunity to help create a new platform for business journalism, write content that will reach more viewers + consumers (especially those under 35) and, I hope, make a real impact.”

Maheshwari said the initial year of reporting for the website was difficult because few understood what it meant for BuzzFeed to cover business news.

“There was fear that it was going to be more of a Gawker-type of publication that aggregates and comments and isn’t really rooted in fact, and so I think we had to prove ourselves in the beginning but now that part is sort of over and now we can do more reporting,” Maheshwari said. “We don’t have to worry about that quite so much anymore.”

Maheshwari has appeared on a variety of news shows shedding light on the retail industry, which can only help to promote the legitimacy and credibility of the business desk’s reporting.

Comparing her job to the one she had at Bloomberg, Maheshwari said there is more freedom with BuzzFeed in terms of what she can cover and how she can format her stories.

Gara said producing content in different formats is what makes BuzzFeed business stand out from its competitors and what makes it accessible to so many audiences.

“One of the good things about BuzzFeed is that we are very flexible and we can write in a lot of different formats if we want,” he said. “If we want we can do a 2,000-word feature, if we want we can do a 500 word quick news story, if we want we can do a list with charts and graphics with a few headlines in between them explaining what happened in earnings results and stuff like that, but I think the thing that’s important with that is knowing when at times to do each of those.”

“I feel like if there is a really complicated issue out there, especially with financial markets like with currencies or interest rates or the central banks, it’s not talking down to your readers to say here’s the five most interesting things one step at a time.”

OMG: What’s it like to be a BuzzFeed business reporter?

Surprisingly, or unsurprisingly, working for BuzzFeed according to its staffers is basically the same as working for any media outlet, except they get more snacks.

Going over his daily routine and duties, Gara said they are pretty similar to what one would expect of any desk editor.

“We’re based in New York so we’re in the same area, and I’ll physically walk around and see what everybody has going on and also talk to them about what I’ve been seeing in the news, what I’ve read that morning or what I think is interesting,” he said.

“Then we talk a little about what they’ve been seeing, and we’ll sometimes think maybe we should do something based on what we’ve been seeing and what is out there that day and what is happening. “

From discussing that day’s stories to editing pieces for accuracy and tone, Gara said the only notable difference between his job and any other editor position at another news agency is that he spends a ton of time on social networking sites publicizing his writer’s work and searching for trends.

“That’s one of the things about BuzzFeed is that we are much more interested in trending stories like through social channels, so a big part of that is just pushing our stories out to those areas like Twitter and Facebook,” he said.

“I stay on Twitter all day long looking at headlines and looking at the conversation that’s going on around the stories we cover and seeing if that chatter is leading somewhere we should be writing about.”

Gara said he pushes his writers to focus on the most unique elements of their stories and not get bogged down by frivolous information.

“I think when you’re a reporter quite often you end up taking a story in ten different directions and throwing in the whole kitchen sink because you become obsessed with the story you’re writing,” he said. “And I think as an editor you’re kind of the regular person reading it in a lot of ways because you’re the first person to see it, and when you read the story it’s a lot easier to identify what’s compelling about it and what’s interesting and new along with what’s unique and what pushes this story forward.”

“Quite often focusing on that and distilling a story down to its most compelling, interesting and unique elements is the most general thing that I spend the most time telling reporters to do.”

And after the final copy is published online that is when Gara steps up to publicize the work across social networks.

WIN: What’s the future of BuzzFeed business?

In a recent interview, VentureBeat editor in chief Dylan Tweney said the journalism industry has to adapt to social media because that is where readers are now and where they will continue to go.

“It’s probably a student that will be able to figure out how to use WhatsApp for journalism,” Tweney said. “It’s not going to be me because I am too busy editing posts for VentureBeat, but [a student] is going to figure out how to make a news channel out of a messaging app.”

While Tweney’s assumption is correct, readers will not have to wait too long for news made directly for social media because BuzzFeed is already doing it.

“We have a team at BuzzFeed called BFF that’s like a new division of the company almost, who’s whole thing is to produce context sort of natively on other people’s platforms, like making stuff directly for Instagram, Snap Chat or Vine,” Gara said. “It never goes on our website. It just goes there first and only there.”

Gara said he hopes his team can figure out a way to tap into this model whether it is by posting graphics directly to Facebook or Instagram or coming up with push notifications for the company’s new app.

He also added that given BuzzFeed’s immense video operation, which averages almost one billion views a month, he hopes to find a way to create more business stories with video components.

This video alone received over 8.1 million views:

“Our video team now pulls in regularly a billion video views a month, and I don’t even know how to think about that number,” he said. “We would get a ten million viewer post on the text or list or news side a dozen times a year, and they are getting it daily.”

“I’d love to think about how to start getting business type stuff in a format that works for video.”

As far as expanding the business desk in terms of numbers, Gara hired two reporters, Venessa Wong and Cora Lewis, in April 2015.

Wong was hired to cover the food industry, having covered it previously for Bloomberg Businessweek. Some of her highlights include: Chipotle: The Definitive Oral History and There’s No Such Thing As Nacho Cheese.

“At BuzzFeed she will be covering the biggest names in the food business, and how they are responding to America’s fast-changing eating habits,” Gara said in an announcement to staffers. “Central to this will be the declining fortunes of some of the country’s biggest and most iconic companies, like McDonald’s and Coca Cola, and the rise of a new generation of food giants.”

Lewis will head up BuzzFeed’s coverage of labor, which Gara said he thinks is a hugely undercovered beat. She graduated from Yale in 2013 and previously interned for the New York Observer and the Wall Street Journal. Lewis also worked as a staff reporter for the New Haven Independent.

“The changing face of the labor market is one of the biggest and most consequential stories in America today, and what happens to American workers in the coming years will be a central story for the economy, politics and culture,” Gara said in an announcement to staffers.

He also said they recently moved a staffer over to cover the hospitality industry, which is an area he sees with lots of potential.

But Gara did note that while he would like to have reporters covering every beat possible, he understands there are some limitations, especially since he is the only editor.

“Moving forward one of the areas I’m really interested in, and we will have hire someone and probably many people in the long run but we don’t want to overrun ourselves now just because it’s a small team with only one editor, is the way that companies use their power to influence regulation and public policy, ranging from corporate lobbies in D.C. to kind of industry specific stuff, like how the energy industry influences that surrounding debate around climate change and renewable energy,” he said.

Hensley-Clancy agreed with Gara saying that expanding into more narrow niches in terms of coverage will help to give BuzzFeed business a powerful voice in its own industry.

“I see us becoming even more respected in our beats, and hopefully becoming a source for more scoops and exclusives as people come to know and respect us,” she said. “I have huge faith in Tom Gara — I think he’s the absolute best person for the job.”

So as Gara makes his morning rounds, chatting to his team about what he read that morning he is not as concerned about the future, but rather the present and how they can work together to create original content that is witty, colorful and informative.

“We have on our job app ‘no haters,’ which sounds funny and it’s a funny tagline that people make fun of, but it really is such an identifiable, tangible thing you feel every day,” he said. “It has such a collaborative environment that people are really happy to be around each other and really like each other on a general level and value humor and that sort of stuff.”

“It’s such a great team to be a part of.”

Meg Garner is a business journalism student at UNC-Chapel Hill.