Technology and Its Role in The Stock Markets

Years ago, making money in the markets was restricted to a few people, those that knew the market and were part of the trading process as brokers. However, with time we saw that technology could play a huge role in dissipating information which is really the key to making the right decisions. Until the year 2000, this industry was largely untouched by the technological advances several other industries were seeing. However, ever since the industries have seen the kind of benefits they could offer to their customers, this industry has been changed forever.

Pricing: One of the biggest advantages to customers has been the lower prices to manage your funds. With competition being thrown open, several players have entered the market, offering to manage your funds at a much lower cost as compared to traditional asset management companies. With the option being able to manage your funds through an account online, users are able to compare the prices, performance, and fees of popular stocks. This has added another level of transparency making it a lot more difficult for asset management companies to charge unnecessary and unwanted charges on your investments.

Relationship Versus Automation: Traditionally, the business of portfolio management has been based on relationships. Much like every other profession, in this too the customers would be approached, thetrust would be built over time and the fees charged on invested funds would allow such companies to prosper. However, Artificial Intelligence (AI) is changing the way these companies do things. With the use of such state-of-the-art technology, companies are using programs which can predict the customer’s behavioral patterns and suggest what would be the right investment option for them. For instance, portals such as provide up-to-date information about companies and news that could affect their prices on the stock market. By tracking such websites constantly (which is now possible through your smartphones as well) you can have a close watch on your investments as well.

Customer Service: Historically speaking, managing a portfolio has been a very intensive and challenging profession which not only involved long hours of scanning information and sorting them into graphs that made sense but involved extensive research into equities, bonds and several other asset classes as well. Algorithms, software and customized programs allow asset management companies to do all of this analysis within a few minutes saving a ton of energy and time. The reduced operational costs allow companies to increase their profits. Further, they are able to pass on a percentage of the customers to attract new customers and retain existing ones as well.

Customer service has moved on from being just a relationship to going well and beyond what is required to maintain a customer. Large companies that have a large market share in this industry train their departments to manage and help customers to manage and track their funds.

Technology has managed to make this process a transparent one thereby giving an opportunity to several people to change the way they look at investments.

Author: Richard Casteel

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Richard is the chief author of this blog. He worked as a financial advisor in money market form last 10 yrs. His financial sense in Share trading and any other trading is just outstanding. He just shares his knowledge and experience through this blog. You can contact him directly though

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