The purpose of technology should always be to make our lives easier and the tasks we have to do simpler. The technology itself may be complex, but the outcome should be greater simplicity. In the world of financial trading, technology has done a lot to demystify a process that was once the sole preserve of educated professionals and big corporations. Now it is possible for anyone with an internet connection to trade successfully on the various markets and to manage their own portfolio if they so desire.
The digital revolution that has seen so many aspects of business and leisure move online has made financial trading accessible to ordinary people for the first time. Thanks to the internet, electronic trading via retail brokers, or directly using one of several online trading platforms, can now be carried out by anyone, anywhere, at any time of day or night. And although the more knowledge and experience you have, the better your chance of successfully profiting from your trades, there is no barrier to stop the average person in the street from immediately starting trading.
A different world
Not so long ago, anyone wanting to buy or sell shares on the stock market had to phone up their personal broker during office hours and instruct them to make trades on their behalf. They would do this after having checked the current market news and prices in a specialist financial newspaper, bought that morning. In this world, the keen amateur was very much at a disadvantage compared to the professional traders operating in the major financial centres, who would be able to follow the rise and fall of market prices as they happened. In addition, only the wealthier members of society could afford to retain a broker in this way.
Level playing field
Today anyone can check any of the financial markets around the world 24-hours a day via their computer, tablet or phone. Technology means that the financial trading sector is now global, as when a market closes for the day in one time zone, another will still be open, and of course traders can buy and sell from anywhere on the planet. Retail or discount brokers can be used online and simply take a small fee per transaction.
One result of this situation is a greater level of competition between digital brokers and providers of online trading platforms. The trader is the winner though as each of these competes to offer the best deals, the best value and the most useful range of features and tools. Many once-specialist tools such as a forex chart are now considered essential inclusions for any serious trading site.
Forex trading was once only pursued by corporate institutions and specialist traders, but over the past decade it has become a popular mainstream option alongside stocks, bonds and other assets. Other once-obscure trading options like CFDs and cryptocurrencies are not only made possible by technology, but are now much more widely traded than they were just a few years ago. Again, it is the ease of access and the perceived transparency of online electronic trading that has made more people want to explore the possibilities of these types of trades.
Undoubtedly the world of financial trading now moves much faster than it did in the previous century. Automation has replaced many of the manual transactions that were once necessary, with automated trading using artificial intelligence, machine learning and complex algorithms to execute lightning-fast trades that no human broker could possibly keep up with. Automation also reduces the risk of error and allows for complicated transactions to be undertaken almost instantly. In the modern trading markets, a fraction of a second can be the difference between making and losing a fortune.
This is the technologically-driven financial world of today. Traders have more freedom and flexibility than ever before, and have far greater access to a constant stream of rapidly-changing information. Indeed, the sheer quantity of data is too much for a human being to handle, meaning computer technology is needed to process and analyse information effectively. Technology has also massively increased the number of financial traders, democratising the process as never before.
It is impossible to overstate the impact of technology on financial trading. The digital revolution has simultaneously made trading far more complex but also easier to enter into. Not only can anyone become a trader, it is also much easier for small providers to set themselves up as brokers by making use of existing technology. Yet in all cases the competition is fierce, and only the best will come out on top.