The brokerage world is changing, but how?

Telephones ringing, people buried in a pile of numbers and fleeting customer interactions, the brokerage world was long identified by these familiar visuals. However, like everything else, this world has evolved significantly. Driven largely by the advent of internet and sophisticated digital technologies, the exclusive world of the brokers is rapidly democratizing as users get enabled through real-time platforms, easy to understand online trading avenues etc. What exactly changed though, and what remains the same?

Since Instinet, the first major electronic alternative to open-cry based trading structure conducted by humans, we have come a long way in the world of electronic trading. Thanks to the myriad of benefits it offers, the shift towards electronic trading has been rather swift. NASDAQ paved the way by adding a number of features to its original model of being more or less an automated quotation system, and post the 1987 market crash when some traders refused to answer their phones, electronic order entry started to gain a major foothold as it promised greater transparency.

Now the brokerage world is witnessing another change, this time in the form of new-age technologies such as data analytics, artificial intelligence, machine learning, virtual assistance via chatbots, etc. All of these technologies contribute in empowering the end-user. In effect, these technologies have turned the dimension of the trading world on its head, by making the end-user the most powerful stakeholder today. Through these tools at hand, service providers today need to ensure the best customer experience in order to lead the market. Real-time pricing, market updates, insights based on vast amount of data analysis, all of these factors have made the modern investment experience extremely different, and much more enriched, than anything in the past.

The modern trading experience relies on democratization of information, instant trading operations, cost-effectiveness due to reduced brokerage, specific and expert services and enhanced customer engagement as its major pillars. What was earlier the domain of only the insiders to the investment world is now available to every user as easily digestible nuggets of real-time information across platforms. Social media has a key role to play here, as even a tweet or a fresh news feed can have valuable information to decide the fate of a trade in an instant.

Data analytics, artificial intelligence, and machine learning are together striking at the core of the investment world i.e. prediction.  The market is won by those who can catch its nerve the fastest, and new-age data analysis has taken the art of prediction to another level altogether. Now, platforms that can bring this level of data backed fortune-telling right to the smartphone screens of their users in the most engaging manner possible, stand the strongest chance to ensure a continuously growing user base, whatever the conditions of the market may be.

By Rohit Ambosta, Associate Director and Chief Information Officer, Angel Broking Ltd