There is no denying the fact that due to the benefits and the growing demand, there is a dire need for technology in the modern era. To begin with, technology is a huge time saver. We no longer need to visit actual banks to obtain information. Better investing options have become more accessible and faster because of innovation. According to Kuvera (a Sebi-registered investment advisory firm), nine out of ten Indians prefer to invest through online investment platforms. Internal and external communications are both improving as technology advances. Furthermore, the entire globe is carrying high-processing devices in their pockets. All industries, especially financial investments, must step up and adapt to the changing environment. As a result, technology can certainly help to enhance investment decisions by providing ease to consumers in the present-day scenario.
Ways Technology Can Improve Investment Decision
Financial-Planning Software: When it comes to investing, nothing is more crucial than having a thorough understanding of the portfolio and cash-flow condition. An individual that lacks sufficient understanding will find it difficult to monitor their stocks or other investments and may make decisions that can affect their portfolio. Investment necessitates continual monitoring and control of cash flow for the investor to purchase appropriate assets at the proper time in order to achieve supernormal returns in the future. This is where financial planning software comes into being to assist in forecasting cash inflows and outflows, allowing investors to plan their investment decisions.
Enhanced digital Security: In the modern days, ever since digitalization has gained center stage, investors have begun to favor online transactions. Technology has made transactions more secure by encrypting and safeguarding datasets. Digital wallets include private information about one’s identity and wealth, and advances in technology have enabled some of these wallets to be decentralized. It has also ensured anonymity, which secures the user’s identity even further. Similarly, contemporary technology has improved the security of personal information and has considerably lowered the likelihood of hacking and security breaches, reducing the possibility of financial losses. Although frauds and hackers are always a concern; hence, it is vital to use strict password regulations, biometric screening, and other measures that have had no effect.
Awareness: The advancement of internet has made financial decisions more convenient and accessible; it has also increased the amount of data. With information overload nowadays, excessive information can cause investors to miss vital news and incur severe financial losses. To address this, an individual can utilize news-aggregation tools that use AI to track headlines that are relevant to their interests. With recent developments in machine learning, those apps can assist in automatically identifying chances without having to spend as much time browsing the internet or newspapers. As a result, as time goes on, investors are becoming more aware of the markets relevant to their assets and can evaluate trends that might help them forecast the future of their investment decisions.
New asset classes: In addition to raising user awareness, technology has aided in the development of new investment channels. Classic examples are fractional real estate, lease financing, international equities etc. Even a decade ago, investing into these asset classes digitally was considered virtually impossible.
Improved Accessibility: With the advent of technology, investments in stocks, derivatives, mutual funds, PMS, AIFs etc. have grown dramatically, and tracking long-term investments has become simple. In truth, the Indian stock market has grown significantly in recent years, with the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) serving as the country’s principal stock exchanges.
(The writer is Founding Member, Centricity)
