How Technology Has Enabled New Investors
Technology has changed the world. The evidence of this is all around us, and almost every aspect of life is very different today from how it was 20 or 30 years ago. Scientific innovation will doubtless continue to transform the way that we live, do business, relax and interact with each other at an even more rapid pace as the 21st century progresses.
One area in which technology has very definitely had an impact is investment. If one looks back to the 1980s, an iconic era for financial trading, it seems like the Stone Age compared to now, populated by city professionals barking into brick-sized mobile phones from the actual stock market floor. Today’s investor is much more likely to be tracking the progress of their investment from home or instructing their broker to execute a trade with the click of a button.
Investing for all
Technology has democratised investment and financial trading, opening it up to a wider demographic than ever before. So many more of us now have investment portfolios, and we’re also far more aware of what that actually means. As a result, we can all make informed decisions with access to information far beyond that which was once the closely guarded preserve of a few industry insiders.
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The role of brokers
Across the board, technology is becoming more affordable and more widely available. Easily downloadable analytical tools can be used to predict trends and give you a better chance of making money. These tools also allow brokers to give their customers a better service. To stay competitive, a broker has to make use of the very latest technology and work alongside IT specialists. Those brokers that really do well will be those that offer bespoke automated systems that deliver provably superior results for their clients.
Easily downloadable analytical tools can be used to predict trends and give you a better chance of making money.
Online trading has completely changed the function of the investment broker. Formerly, an investor had to get through to their broker on the phone in order to make a trade, with a commission of up to 2.5% each time. Online trading gives you direct access to real-time prices and makes trading itself more direct, faster and cheaper.
Empowered by technology
The proliferation of mobile technology – most notably smartphones with ever-increasing memory and capability – has further empowered the individual investor. Apps and tools allow you to track your investments and make financial decisions without requiring huge amounts of technical knowledge.
The arrival of social trading has also greatly enabled new investors. Platforms that allow the novice to follow, interact with, and get advice from more experienced traders mean that there are far greater opportunities to learn about high-level investing as you go along.
Rather than spend years studying the market and reading weighty tomes on the subject before going anywhere near the market, copy trading allows anyone to emulate the moves of big traders, learning the ropes at the same time as hopefully turning a profit. For those who want to learn as they go without the risks, many platforms offer free demo accounts where you can have a go at buying and selling without real-world consequences.
General social media has also given every investor access to a world of valuable background information. You can analyse sentiment, spot trends, and follow how political and economic news impacts on the market, using this to inform your trading decisions.
Robo-advisors and AI have also opened up the world of investment to a host of individuals who would never previously have thought about playing the market. These algorithm-powered tools for financial planning can be accessed cheaply and easily and have helped millions make sensible investment decisions with their pensions and savings.
Algorithm-powered tools for financial planning can be accessed cheaply and easily and have helped millions make sensible investment decisions with their pensions and savings.
Technology gives you more options. If you don’t want to invest on a major scale, then there’s likely a niche account that’s just right for you. You can set your own risk parameters or what kind of companies you want to invest in, creating a custom portfolio based around certain sectors or ethical considerations.
Overall, technology has completely opened up the world of investment, making it easier and more convenient to access than ever. From crowdfunding to cryptocurrencies, forex to future trading, the markets are all accessible from your phone, and there are many sources of information and advice to help you on your way. If you’ve ever thought about investing, now is the time to get involved.