The evolution of stock trading: where next?

The evolution of stock trading where next
Photo: Phongphan, BS

It is no overstatement to say that the global stock markets are central to modern business and how we all live now. They provide the driving force behind the economies of not only whole countries due to this but also whole regions. If you take Australia as an example – the Australian Securities Exchange has a market cap of over $1bn, with over 2,000 of the country’s top businesses listed on it to invest in.

What has been interesting in recent times though is the evolution of stock trading. Stock markets and therefore stock trading have been around for a long time but look very different now from even 30 years ago.

What has happened to drive this change within the financial sector?

Digital revolution within stock trading

Although trading in stocks has naturally evolved over time since the first stock markets were set up, it is in recent years that the biggest changes have been seen. Stock trading has undergone a digital revolution thanks to modern technology – the internet in particular has really moved the goalposts.

Traders can now access the stock exchanges to trade on via their PCs, laptops, smartphones or tablets. The internet and powerful trading software allow you to place orders through an online broker and manage your own portfolio directly online. The new wave of online brokers have made it not only easier to understand stock trading but also more accessible as they do not have high minimum deposit or trade limits. The way that you can access news to trade stocks on has also changed a lot over the years. Modern traders can now pull up the latest stock market summary online at any time of the day to base decisions on.

Naturally, this has opened up the stock trading sector to ordinary people and those who may not work professionally in the finance sector already. Compared to the old days of having to place orders through professional traders who were physically on the floor of stock exchanges, it is a massive shift.

Where to next for stock trading?

When thinking about where stock trading in Australia may head next, it seems to centre on future advances in technology. One big area that many expect to see grow is the influence of AI in stock trading. Powerful new AI tech within broker platforms, news sites or search engines may begin to hunt out and suggest trades to open, based on previous ones you took on.

In terms of tech, it seems pretty certain that constant advances in smartphone and computing power will also push the sector forward. More processing power will lead to ever more sophisticated charting software and innovative broker platforms to be used. This could see traders being able to develop advanced new strategies to find companies to invest in.

Change is certain to happen

Now that stock trading is a digital process for most, constant progress seems assured. As the technology behind broker platforms, charting software and the stock markets themselves evolve, so will how we trade them all. This is a positive thing for traders though as it should make trading quicker, more intuitive and easier to succeed at.