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How Technology Influences The Stock Trading Market

Technological developments have influenced a lot of businesses, governments, social lives, and education. Nowadays, people can easily access resources and information they need to maintain and run their businesses. One of the areas that have been greatly influenced by technology is the stock market. If you want to be successful in stock trading, you must…

analysis trading

Technological developments have influenced a lot of businesses, governments, social lives, and education.

Nowadays, people can easily access resources and information they need to maintain and run their businesses. One of the areas that have been greatly influenced by technology is the stock market. If you want to be successful in stock trading, you must embrace technology. As an investor or broker, you may have realized how technology can help one become a great investor. The following are different ways technology influences stock markets.

Stock
Brokers and Technology

In the past, traders at the stock
exchange used to shout out orders. They would gather around the stock trading
area and begin shouting matches. Fortunately, that is no longer the case, as
trading has been made a lot easier. Nowadays, you do not have to shout orders,
and you can easily get the best stocks by researching online.

Moreover, research has greatly improved.
In the past, people had to look for information in the library, contact
companies, and read financial literature. You can now get the information you
need about different companies easily.

Digital
Stock Trading

Technology has changed how people trade.
For instance, technology resulted in high-frequency trading. This is where
traders ought to purchase and sell stocks within a short period. High-frequency
trading is also known as day trading.

This has had a huge impact on people’s
lives. That is because it is simple to make investments on stock
trading with minimal risk
. In fact, you can even earn a lot of money within
a single day. Investors that want to make huge investments will always feel a
great impact on the returns.

Monitoring
Real-time Stock Performance

The use of advanced computers has made it
easy to buy and sell stocks. Also, it makes displaying them quite easy. That
makes it for investors or brokers to know the Share prices of
a given stock and get the details within a few seconds. Also, you can get the
information you can trust. If you want to invest in a given company, you can
easily gather a lot of information concerning the company before you invest
your hard-earned money.

Also, technology has reduced the
incidences of human errors in transactions. That is because most of the
transactions are now made by advanced computers. It is easy to research on the
company’s progress and choose the right investment and close your trade if you
feel it is at great risk. That explains why a lot of people go for day trading
as it is less risky.

The invention of the internet and
technology are the greatest revolutions. That is because they have changed how
people carry out their businesses and even make trades.

Use
of Apps in Trading

Various stock trading apps have been
developed. These apps have made it easier to access the stock markets. Also,
stock trading providers that are technology-driven have substantially fewer
overheads resulting in a drastic reduction in fees. You should note that most
investors and traders are turned off by huge fees as they reduce their overall
turnover. With reduced fees, investors can now trade any given amounts and
create wealth.

The fact that these apps can be installed
on smartphones means they allow people to trade anywhere and anytime.
Therefore, people are less restricted as far as stock trading is concerned. The
good thing about the less restricted method is that it opens up a lot of
possibilities that change the way stock trades are carried out. For instance,
you can find a lot of websites that provide free trading. With a demo account,
you can learn
the basics of stock trading
before you start trading with real money.

Speedy
Transactions

You will agree that most transactions are
now done instantly. In the past, transactions were done by shouting from one
person to another and through telephones. Now they are done online. As a result
of speedy transactions, more trades are being executed. As the market changes
take place, investors can now react as quickly as possible. Quick reactions to
the new information mean that the markets keep changing faster than ever.

Easy
Decision Making

With easy access to the internet, people
can now get the information they need. In this way, you can easily make
decisions. Rather than relying on other people’s analysis and recommendations,
they can now download company reports and make their own judgments whether the
investment is good or not. In addition, the information you get is in-depth as
various technological tools can analyze it for you. Thus, you have everything
you need to make informed decisions. A lot of companies offer real-time
information on stock markets. In this way, they give you an opportunity to see
potential trends you should capitalize on and take advantage of the
ever-changing stock market.

Sporadic
Shifts

It is vital to note that not all aspects
of technology have been useful in the stock market. There are situations where
the stock movements have been found to have been triggered by false signals.
Taking into account how quickly information is disseminated in this era, there
have been instances where investors have relied upon misleading information.
Also, automated trading has got rid of the need for market signals. Moreover,
automated trades have been found to cause sudden shifts and panic in stock
markets. Well, technology has also proven to help correct such situations.

Technology has revolutionized many
sectors and areas of the world. For instance, it has improved the quality of
life, accelerated manufacturing, and has made various aspects of life more
effective and efficient. The stock market and financial markets have received
their fair dose of technology. The above are some of the many ways that
technology is shaping the future of stock trading. If technology is removed
from stock trading today, huge losses will occur. It is a fact to say that
technology has had a tremendous impact on stock markets, and it is bound to
shape their future. Remember that technology has its merits and demerits in
stock trading and the financial market.

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Daily Financial News

Don’t Count On JPY Correction; Staying Long GBP/JPY

The path of the potential pace of the JPY decline may still be underestimated by markets, which continue trading the JPY long.

While the 10% USDJPY advance from September lows looks impressive from a momentum point of view, it may no thave been driven by Japan’s institutional investors reducing their hedging ratios or Japan’s household sector reestablishing carry trades.

Instead, investors seemed to have been caught on the wrong foot, concerned about a sudden decline of risk appetite or the incoming US administration being focused on trade issues and not on spending. Spending requires funding and indeed the President-elect Trump’s team appears to be focused on funding. Here are a few examples: Reducing corporate taxation may pave the way for US corporates repatriating some of their USD2.6trn accumulated foreign profits. Cutting bank regulation could increase the risk-absorbing capacity within bank balance sheets. Hence, funding conditions – including for the sovereign – might generally ease. De-regulating the oil sector would help the trade balance, slowing the anticipated increase in the US current account deficit. The US current account deficit presently runs at 2.6% of GDP, which is below worrisome levels. Should the incoming government push for early trade restrictions, reaction (including Asian sovereigns reducing their holdings) could increase US funding costs, which runs against the interest of the Trump team.

Instead of counting on risk aversion to stop the JPY depreciation, we expect nominal yield differentials and the Fed moderately hiking rates to unleash capital outflows from Japan.The yield differential argumenthas become more compelling with the BoJ turning into yield curve managers. Via this policy move, rising inflation rates push JPY real rates and yields lower, which will weaken the JPY. Exhibit 12 shows how much Japan’s labor market conditions have tightened. A minor surge in corporate profitability may now be sufficient, pushing Japan wages up and implicity real yields lower.

JPY dynamics are diametrical to last year . Last year, the JGB’s “exhausted”yield curve left the BoJ without a tool to push real yields low enough to adequately address the weakened nominal GDP outlook. JPY remained artificially high at a time when the US opted for sharply lower real yields. USDJPY had to decline, triggering JPY bullish secondround effects via JPY-based financial institutions increasing their FX hedge ratios and Japan’s retail sector cutting its carry trade exposures. Now the opposite seems to be happening. The managed JGB curve suggests rising inflation expectations are driving Japan’s real yield lower. The Fed reluctantly hiking rates may keep risk appetite supported but increase USD hedging costs.Financial institutions reducinghedge ratios and Japan’s household sector piling back into the carry trade could provide secondround JPY weakening effects

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Daily Financial News

Mexico raises interest rates, cites Trump as risk

The head of Mexico’s central bank says U.S. Republican candidate Donald Trump represents a “hurricane” sized threat to Mexico.

Banco de Mexico Gov. Agustin Carstens told the Radio Formula network Friday that a Trump presidency “would be a hurricane and a particularly intense one if he fulfills what he has been saying in his campaign.”

Trump has proposed building a wall along the border and re-negotiating the North American Free Trade Agreement.

Mexico’s central bank raised its prime lending rate by half a percent to 4.75 percent Thursday, citing “nervousness surrounding the possible consequences of the U.S. elections, whose implications for Mexico could be particularly significant.”

Mexico’s peso had lost about 6 percent in value against the dollar since mid-August. It recovered slightly after the rate hike

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Financial News

Africa’s first Fairtrade certified gold co-operative offers hope to gold miners living in poverty

Syanyonja Artisan Miners’ Alliance (SAMA) has become the first artisanal small scale mining co-operative in Africa to become Fairtrade certified, bringing much needed hope to impoverished communities who risk their lives to mine the rich gold seam that runs around Lake Victoria.

SAMA is one of nine previously informal groups from Uganda, Kenya and Tanzania which has benefitted from a pilot project launched by Fairtrade in 2013. This innovative program aims to extend the benefits of Fairtrade gold to artisanal miners across East Africa.

In that short time, SAMA has undergone training in business and entrepreneurship, as well as safe use of mercury, internal control systems, labour rights and better working conditions, health and safety and more. Previously, daily contact with toxic chemicals used to process gold meant members risked disease, premature births and even death.  Fairtrade gold was first launched in 2011, and SAMA now joins Fairtrade certified gold mines MACDESA, AURELSA and SOTRAMI in Peru.

The co-operative produces just 5 kg gold per year, but nevertheless has the potential to significantly benefit many people in the local community through better conditions through certification. It is expected that Fairtrade and organizations like Cred Jewellery will support the miners, ensuring their gold can be refined and made available to jewellers in the UK and other markets.

Gonzaga Mungai, Gold Manager at Fairtrade Africa said: “This is a truly momentous and historical achievement and the realisation of a dream that is many years in the making. Gold production is an important source of income for people in rural economies. Congratulations to SAMA, it sets a precedent which shows that if groups like this can achieve certification, then it can work for others right across the African continent.”

The Fairtrade Gold Standard encourages better practice and changes to come in line with international regulation around the production and trade of so-called ‘conflict minerals’. Under the Standard, miners are required to:

  • Uphold a human rights policy preventing war crimes, bribery, money laundering and child labour
  • Clearly represent where the minerals were mined
  • Minimise the risks of conflict minerals through robust risk assessments and collaboration across supply chains
  • Report to buyers and trading partners regarding the risks of conflict minerals

Now in its second phase, the programme will focus on supporting other mining groups in the region to access affordable loans and explore a phased approach to accessing the Fairtrade market, allowing more mining co-operatives across Africa to participate in the programme.

Gonzaga added: “Sourcing African metals from smallscale miners in the Great Lakes Region is the responsible thing to do. For a long time companies have avoided buying gold from this region, with devastating consequences for impoverished communities who were already struggling. It has driven trade deeper underground, as unscrupulous buyers pay lower prices and launder illegal gold into legitimate supply chains. That’s why we have chosen to work with these groups to help them earn more from their gold within a robust compliance system that offers social, environmental, and economic protections.”

The Fairtrade gold programme offers a small but scalable solution to sustainable sourcing of gold from the region in line with Section 1502 of the Dodd-Frank Act in the US, OECD Due Diligence Guidance and recent EU Supply-Chain Due Diligence proposals which could come into effect in 2016. This means that up to 880,000 EU firms that use tin, tungsten, tantalum and gold in manufacturing consumer products could be obliged to provide information on steps they have taken to identify and address risks in their supply chains for so-called ‘conflict minerals’.

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