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How Technology Has Influenced the Stock Market?

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Technology has completely revolutionized the world we live in. As per the survey, the number of active web users globally is more than 4 billion, which is almost half of the world’s population. Modern technology has carved the way for making our lives faster, feasible, and fun. One of the areas that have been completely transformed by technology is the stock market. As more and more smartphones are landing in the pocket and the reach of the internet is spreading among wider sections of society, trading is also increasing. If you want to attain success in the field of stock trading, then you should embrace technology.  


Stock markets across the globe are using technological advancements for secure transactions management and monitoring. There was a time when brokers used to yell at each other for exchanging orders creating a whole cumbersome environment. But today’s high trading goes without yelling and provides a great way to research and purchase stock. By inculcating technology, the stock market has become more user-friendly by providing faster trade settlement, increased transparency, enhanced security, automated surveillance, and a lot more.

In this blog, we will discuss how technological advancements have influenced the stock market. So let’s get started.

1. Use of Online Apps in Trading

Online trading apps have completely transformed the trading experience. Gone are the days when you need to hire brokers and worry about monetary losses, paperwork, and many more. The use of apps has made the trading experience completely flawless. Some benefits of trading apps are:

  • It has made the experience hassle-free
  • It is more convenient and accessible
  • Provides you with a better understanding of your money
  • Removes the role of middleman
  • It provides you with the perk of trading at your fingertips
  • Enhances your understanding of the stocks

Overall online trading apps provide feasibility by reducing the trading cost and hassle, making this a more lucrative service.

2. Use of AI in the Stock Market

AI has proved to be a game-changer in the domain of the stock market. It is shaping the future of stock trading. As per the latest survey, electronic trades account for nearly 45 percent of revenues in trading. Top companies are incorporating quantitative trading with big data processing and machine learning technologies to provide real-time market analytics.

Some AI-powered tools for stock prediction are Auquan, EquBot, Trade Ideas, and Blackbox Stocks. Automated robots are used to analyze thousands of data points to execute trades at minimal prices and eliminate the risks. Further, it enhances the accuracy to provide the maximum return.  

3. Faster Transaction

Stock market participants were required to go through a hectic and time-consuming process to regulate any transaction due to the presence of intermediaries. Latest technological advancements in the stock market will offer faster and secure transactions. As intermediaries in the system get minimized, further monetary issues like manual records, audits, and verification are eliminated.  

4. Real-Time Monitoring

Real-time monitoring facilitates the trading experience and enhances profit to a great extent. The latest technological advancements make it feasible for investors and brokers to get accurate and trusted prices. Also, it has eliminated the risk of human errors in trading. Now it is really easy to research the progress of the stock and choose the right investment option. Investors can now react as quickly as possible. Quick availability of information is linked with faster changes in the market than ever. All this has made the trading experience less hectic and more feasible.  

5. Enhanced Security Features

Technological advancements have provided a secure platform for trading activities; it is like automated surveillance for each transaction. It keeps the record of all transactions, which brings complete trust and transparency to the market.  

6. Use of Blockchain in Trading

Stock markets across the globe are embracing Blockchain technology for faster and secure transactions. It has a huge potential for secure trading and monitoring risks. Many markets regulating authorities like Japan financial services agencies, NYSE, Deutsche Borse, etc., are willing to use blockchain in their infrastructure. SEBI has also taken steps to embed blockchain technology and derive the benefits. The use of blockchain will bring complete transformation in the stock market; it offers amazing benefits like:

  • Eliminate the risk of third party authorities using smart contracts and network regulation
  • Use of automation to provide the infrastructure for faster trade settlement.
  • Provides a robust platform to implement security measures by tracking and reporting illegitimate activities.
  • It offers a solution to post-trade events by reducing operational risks, hence providing an infrastructure for fast trade settlement.

Blockchain will completely transform the stock market by providing robust security measures, higher liquidity, lower transaction cost, automated surveillance, and much more.

7. Feasible for Masses

Technological advancements have reduced the inefficiencies that have led to a reduction in costs which has reduced the entry barriers. Also, it helps to reduce the cost levied on the customers in terms of commission for speeding up the process for a quick settlement. So now, the people who were unable to access the stock market due to higher costs will participate in this due to cost reduction.

Conclusion: Technology has transformed many aspects of the world. It has improved the quality of life to a great extent making it more effective and efficient. It has made the stock market a more feasible, secure, and efficient place for traders and investors. If technology is removed from the stock market, it will incur great losses. So technology has indeed shaped the stock market and will continue shaping the future of the stock market!

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Last Updated : 13 Dec, 2021
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