3 Crucial Ways Technology Has Changed Investing

Three and four decades ago, investing was primarily an activity for the middle and high-income class. Fortunately, with the advent of the internet and technology, it is more open to all persons willing to invest and have some financial resources to commit to it. It is probably why statistics indicate that about 55% of adults have already ventured into some form of investment. The percentage is close to gains made in the mobile gaming industry. Hopefully, with the ease introduced in investing, more people will see its benefits. Here are some ways technology has changed investing.

1. Online trading

Reports indicate that about three decades ago, the demand for investment brokers was at an all-time high. This happened because the internet penetration rate was low, and technology was not advanced enough to make investment procedures easy. Fast forward to the 21st century, and more gains made in the area of technology have made it possible to monitor trading and investments online. For example, with the introduction of the Metatrader 5 software, an improvement over the Metatrader 4, investors can monitor the progress of their funds. This can be done from the comfort of home or anywhere else in the world.

Online trading takes away the stresses of finding an investment broker to monitor the basic activity of funds. Although this is not to rule out the benefits of brokers, it makes more sense to have access to your investment and learn things firsthand. Additionally, it helps you save some money you may have paid a brokerage to provide direct analysis and monitoring. Online trading saves time you would have committed to placing calls to brokers. This time around, you can trade directly and without intermediaries. In this case, a broker may come in only when you deem it necessary.

2. Access to big data

It is easier than ever to collate data from investment funds and traders with the internet. Through technology, the internet has become a conduit for investment analysts to pool numbers for future decisions. Remember that these numbers are critical for taking economic decisions on the national and international levels. Apart from the economic benefits of pooling these numbers, access to data offers the platform to monitor illegal activity. When economic crimes are at an all-time high, it has become vital for experts to keep an eye on such trading transactions.

Some institutions that access the data are banks, government, fintech, hedge funds, and other agencies that manage critical portfolios. In certain circumstances, anti-money laundering agencies also have access to the data. They do this to pick up any suspicious activity that suggests sinister transactions and trading. One notable institution that makes great use of such data is Goldman Sachs.

3. The convenience of electronic stocks against physical stocks

Three decades ago, stock certificates were the only valid confirmation of trading securities. Although it was in demand at the time, people lost their physical certificates, or the papers got damaged. Today, with the introduction of electronic certificates, stock ownership has more security. You will need your password to access your online certificates, and even in the event of losing your PIN, you can retrieve it after satisfying certain security questions.