Nowadays every aspect of daily life is constantly interconnected with the digital world. No area is now free from technological contamination. From the most basic to the most complex actions, there will always be a device or software ready to facilitate you, help you, increase your security. Technology and innovation are changing the way we live, produce, interact…
The digital revolution in everyday life
The digital revolution with the arrival of the internet, in the opinion of the World Economic Forum, has totally rewritten the rules of commerce, media and communication in general, financial services; and it is easy to predict that in the next 10 years technology will radically change the sectors of production, energy, agriculture, transport and others, for an overall value equal to 2/3 of the global economy.
Just think that every aspect of daily life can be managed by an app, such as those developed by banking institutions which have increasingly tighter identification systems and which provide ever more security, which allow you to always have the situation of your receipts, savings, exits etc. Or think of the apps made available by the British government to facilitate access to services (or even to calculate taxes). Even the investment sector has been involved in this flow and growing development.
How the investment market has changed?
This development has also completely changed the investment market. In fact, the film images in which men shout into the telephone and exchange incomprehensible gestures from one end of the room to the other while monitoring the performance of the shares are now a cinematic memory set in the heyday of Piazza Affari or Wall Street.
Today the real protagonists of the investment market are silent and precise software, which for about a decade have almost completely replaced the “traders”. Algorithms that monitor, analyze, keep track of market trends and that “learn” these fluctuations so as to be able to recognize them and, why not, predict them.
The world of investments has been influenced by the development of digital technology and as we can grasp on Moneyfarm website, lots of investors use technological tools such as robo advisors in defining their investment strategies.
Through tools such as robo advisors, it is possible to adopt systems that are continuously updated and that continuously receive data relating to exchanges, transactions and quotations in the reference market, thus making the information on the investment within the reach of the interested party and cutting out on his “indications”, the most suitable investment.
Therefore the influence of technology is felt both on the trading floor of investments and in management. Let’s think of investments in technology stocks such as bitcoin or investments with equity securities of large companies that develop technology for the whole world, think of Apple and Microsoft.
Investment plan
Even when an investor decides to utilize the most advanced technologies in the financial field or to invest in innovative financial products such as cryptos, he or she must always start from an analysis of one’s own needs and objectives.
The first point to consider and define it will be the amount to invest and the timing of investment, since an investment oriented towards the long term will have different characteristics and trends than an investment oriented towards the short term. The latter generally takes the form of low-risk financial products with lower rates of return.
The most aggressive investors are oriented towards high-risk financial products that foresee higher earnings, but with higher probabilities of huge losses.
The choice of a careful investor is to diversify his financial wallet as much as possible, so that the different performances of assets with heterogeneous characteristics decrease the level of risk.
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