Investing is a central tenet of wealth protection and generation for business, high-value individuals and even retail traders today. News of imminent recession has had an unignorable impact on businesses and the stock markets, but somehow traders are less spooked than in previous recessions. This may have something to do with new technological solutions surrounding investing, particularly big data. But what are these solutions?
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What is Big Data?
First, it is important to understand exactly what we mean when talking about ‘big data’. The term is largely used to describe vast and complex sets of data, that conventional analytical methods fail to fully comprehend. The term arose in the mid-1990s, as the digital age began proper; our data storage capabilities rose dramatically with the development and refinement of digital storage and continue to do so today.
This has enabled the capture and retention of vast arrays of information, from tangible items and assets like photographs and text to metadata surrounding user activity on search engines, social media platforms and other media sites. Contained in these oceans of information are valuable and lucrative insights, that hold their own value for individuals, enterprises and even entire economies.
But the size and flow rate of this data outstrips the capabilities of traditional computing and analytical software – necessitating a bespoke technological approach that has since come to be defined as ‘big data’ itself. Big data is now an industry as well as a concept, of tools and services that aim to shepherd and analyse these vast data sets for crucial insights and industry prediction.
Big Data and Investing
But what does the emergence of big data and its technological solutions mean for investing? The discipline of wealth management and growth is by no means new itself, with successful investors achieving great feats on the stock market with little more than a telephone in the pre-Internet age.
Big data, though, is nothing short of a revolution in information management – with profound impacts for the advancement and equitability of investments and trading. The wealth of information, and the expansion of capabilities in understanding it, has resulted in some key shifts for the betterment of the industry as a whole.
Accessibility
One of the more important outcomes of big data has been the improvement of access to investing tools and opportunities. Ubiquitous access to trading and stock market information has enabled the launch of retail trading apps that allow individuals to grow their own wealth.
CFD trading alone is a multi-billion-pound industry, with users profiting on margin from the movements of stocks and assets without directly investing in them. Retail trading apps now provide traders with all the market information and statistics necessary to make their own informed choices, with thanks to big data analysis.
Profitability
With regard to larger-scale organisations, big data has had a revolutionary impact on profit-making and risk assessment alike. Businesses can more accurately understand the risk inherent to their portfolio, based on the nuanced examination of industry and market information – and better hedge against failure as a result.
