Technology has indeed transformed the financial services sector, making it easier for individuals to participate. Investment, in particular, owes a lot to advancements in tech. In the past, this field was seen as exclusive to wealthy, often older individuals, and financial experts. However, at present, tech is making it increasingly easier to invest.
Let’s explore how below:
1. Increased accessibility
Without a doubt, the largest impact tech has had on investment is making it accessible on a global scale. People no longer need to visit a brick and mortar location just so they can invest. Since we are no longer restricted by physical borders, individuals can also access investments from all over the world. It is easier than it has ever been to buy stock in a foreign stock index, or trade commodities, for example.
Basically, any individual with the will to invest – anywhere and in anything – can do so with the help of tech.
2. New investment segments
Some of the most valuable stocks today belong to tech companies, an indicator that tech as an industry is a vibrant participant in the investment ecosystem. Tech giants such as Google, Facebook, Apple and Amazon are part of a high-performing group of corporations that have experienced massive growth in the past few years, creating value for their investors.
Cryptocurrency is another example of an investment sub-group that exists only because of new technology – in this instance, blockchain.
3. Opportunities to learn
The internet age is characterized by easy access to information. One doesn’t need to be a financial or investments expert to invest anymore. There is a wealth of easy to understand content available to novice investors online.
4. Roboadvisory and financial planning software
One of the most recent innovations in investing technology is roboadvisors, digital applications that perform the same work as traditional financial advisors. They give recommendations based on algorithmic calculations, which are meant to eliminate as much human bias as possible.
While they are still not in mainstream use, their presence gives us a clue as to what the future of investing could look like. There are also several financial planning softwares that automate different aspects of the process, making it more convenient for investors to transact.
As tech evolves and becomes more pervasive, it will surely continue to shape the investment sector. To get the most value from this reality, investment managers need to place tech at the core of their strategy.