Trading is no longer seen as a niche activity. Millions of people all over the world now have access to markets – and even forex pairs – thanks to a series of apps, websites and platforms at their fingertips. It’s entirely possible to make money on the side while working a full-time job. However, it’s only been made easier for most people thanks to the evolution of trading technology over the years.
Over the years, advances in trading technology have helped us to make smarter, more efficient decisions when it comes to our portfolios. Learning how to start trading crypto, for example, has never been easier thanks to a wealth of insight from algorithms, big data, and innovative programming. But how else is technology helping us to become more intelligent on the wider markets?
Robo-Advisors Are the Future
The rise of the robo-advisor is, of course, a huge factor in trading evolution the world over. For those new traders who may be risk-averse, or who may wish to start profiting sooner rather than later, code can pretty much do it all.
From the start of opening up an account or portfolio, several platforms now allow users to create profiles based on their risk attitudes. Simple questions that can be answered within a few minutes enable robo-advisors to understand when users want to buy and sell.
This automated trading strategy can prove to be very fruitful. For example, it removes the risk of emotional investing and trading. Emotions can risk huge amounts of capital – for example, if you are riding a spike and don’t want to sell, or if you are taking a dip and are worried things will get worse.
AI and robo-advisors can effectively trade on your behalf, making decisions for you without the need to get emotionally invested. This cuts trading completely to its logical basis, therefore relying on raw data and the profile you effectively set up at the start of the process.
More Data Than Ever Before
There’s an argument that too much data can be a bad thing, but from a trading perspective, this is hardly the case. When it comes to analyzing form and making predictive analyses, traders have relied on raw historic data for decades. However, thanks to the growth of the internet and the development of data capture and correlation tools, this information has never been more widely available.
It’s available to such an extent that trading platforms can now confidently offer ‘demo accounts’ and even online courses to help new joiners get to grips with the graphs and charts available to them. While previously a major issue may have been finding data and knowing which may be relevant to any given portfolio, the issue now is simply knowing how to use it to our advantage.
That, of course, is where AI and robo-advisors fill the gap. With the help of machine learning and data collation, we’re getting to a point where we may not even need to look at data to be able to use it. This, of course, leads us to a point of peak efficiency.
Where Will It All End?
As technology advances, trades become more efficient, more frequent, and ergo, more impactful. Market volatility is already marked heavily by traders changing positions en masse, or with data greatly changing as a result of societal or political shifts. With more traders having wider access to data – and more efficiently – we may expect wider and wilder changes in market values in the years to come.
The sheer volatility in cryptocurrency trading, for example, may be as a result of widespread buying and selling around the clock. Sheer activity is unlikely to derail stock completely, but as more of the world gets into the markets through more convenient and far-reaching code and tools, it stands to reason that we can expect the landscape to change at least to some extent.
Crucially, technology is helping to make trading more exciting. It may not be a case that it is making us smarter traders, rather, it is making difficult decisions easier to process. Could technology actually be dumbing down trading so that more people can make bank? It’s entirely possible.
In the meantime, we are trading in one of the most exciting periods for the markets. The tools and AI we have at our disposal are opening up lucrative moments for millions of people – and now might just be the time to get on board. You don’t have to understand what crypto mining is to make a splash – and thankfully, tech is here to help you along.