Developments in the digital age and the rise of the Internet have had a transformative impact on the investment sector during the last decade. The wide availability of information and proliferation of viable platforms, tools and software has resulted in an evolution of communication and the emergence of a new type of share trading platform. Today, the vast majority of activity takes place through complex computer systems and high-tech networks, which can provide live streaming capabilities and additional functionalities. Online trends and the march of innovative tech have changed many industries, and investment is no different.
One notable recent change for trading has centered on the use of HTML5 rather than Flash, Java and .NET technologies, which had previously been the basis for trading platforms. The investment sector is now a mobile industry; traders are using their smartphones and tablets every day and HTML5 is the only tech supported on the majority of these devices and operating systems. The shift has also been beneficial to the financial industry, as it has led to enhanced accessibility, consistency, mutuality, improved interactions and responsiveness.
The new wave of mobile trading has made investment even more accessible to entrepreneurs and enterprises, as it is now easier to trade due to enhancements in software semantics, graphical integration and simple multimedia interfaces. The Internet has broken down barriers that previously existed when trading was consigned to the stock exchange floors and tactile machines. It also means traders can access all the information, tools and features they need from one interface and link them in real time. New tech has also improved geolocation tracking, which has enabled brokers to deliver a step-change in response rates to traders.
There is a wealth of stocks being traded online, including binary options, which offer only two, all-or-nothing outcomes. Options contracts are currently among the most popular offering on trading platforms as they provide investors with a means to seek faster returns on their money. The short, 20-minute options now account for around 15% of volume on Nadex, and according to CEO Tim McDermott, offer “great opportunities for investors”. He adds: “We really saw the levels of trading in our two-hour binaries increase in the last two minutes of their life, so that’s why we created the 20-minute contract.”
Internet trading platforms have also created a headache for regulators due to the emergence of competition to established brokers. There are also special platforms called “dark pools”, that allow the trading of shares away from these exchanges. Tech has enabled companies that used to represent a small percentage of the tech business to rise up and become household names. However, the impact of the Internet has brought many benefits to investment, with Wharton Business School’s white paper claiming that it has increased transparency and defined differential pricing.
More importantly, the Internet has lowered the costs of entry for individuals significantly, as most financial market participants are now able to trade more efficiently and with greater ease than before the advent of digital tech.