<#-- Rebranding: Header Logo--> <#-- Rebranding: Footer Logo-->
  1. Investing 101: Introduction
  2. Investing 101: What Is Investing?
  3. Investing 101: The Concept Of Compounding
  4. Investing 101: Knowing Yourself
  5. Investing 101: How Technology Has Changed Investing
  6. Investing 101: Types Of Investments
  7. Investing 101: Portfolios And Diversification
  8. Investing 101: Conclusion

Technology has had a profound impact on most every aspect of our lives. Investing is certainly no exception. In fact, technology has democratized investing in the last several decades and also exerted significant downward pressure on fees.

 

Buying and selling securities

 

Years ago, if you wanted to make a trade you would need to call your stockbroker and place an order. The commission rates to buy or sell stocks was pretty much fixed and high due to a lack of information and alternatives. Investors wouldn’t know how their investments were faring until they received their account statements in the mail.

 

Today investors can search the web to see which brokerage firm has the lowest transaction fees and buy and sell securities themselves at the click of a mouse. Fidelity started a new price war in the cost of trading stocks and ETFs by lowering their transaction costs to $4.95 per trade. Schwab quickly lowered their price to match Fidelity, while TD Ameritrade also reduced their trading commissions.

 

Many brokerage firms and other custodians offer apps to allow investors to track their investments using their phones. Alerts can be established on various holdings and so much more.

 

Technology has also armed both individual investors and investment advisors with the tools to perform cutting edge research and analysis on investments and to help manage portfolios.

 

Robo advisors

 

One of the biggest innovations of the past ten years has been the advent of the robo advisor. Firms like Betterment, Wealthfront and others have used technology to allow them to construct and manage client portfolios using algorithms. Most robo advisors invest in low cost ETFs. Taking the human element out of the investing equation can drastically lower the cost of investing.

 

Robo advisors have been adding additional services as well. Both Betterment and WealthFront offer tax loss harvesting for taxable accounts. Betterment offers a 401(k) product and has a version that partners with financial advisors as well.

 

Bigger players like Schwab, Vanguard and Fidelity have taken notice and have started their own robo services, sometimes augmented with human advisor. This technology promises to continue to revolutionize the investing landscape in the years to come.


Investing 101: Types Of Investments
Related Articles
  1. Tech

    Robo-Advisors: Major Players and Their Offerings

    Here's a round-up of the most well-known robo-advisors and what they offer.
  2. IPF - Broker

    What Type of Brokerage Account Is Right for You?

    A broker, also known as a brokerage, is a company that connects buyers and sellers of things like stocks and bonds.
  3. Tech

    When a Robo-Advisor is the Right Choice

    Robo-advisors provide benefits to specific types of investors with a certain set of needs.
  4. Tech

    The Benefits of Combining Advisors and Robo-Advisors

    There are many benefits to combining traditional financial advisors and robo-advisors.
  5. Tech

    How Fidelity's Robo-Advisor Will Likely Compare

    Fidelity Investments recently announced that it will be launching its own robo-advisor service later this year, Fidelity Go. Here's what we know so far.
  6. Tech

    The Millennial Guide to Choosing a Financial Advisor 

    Choosing the right financial advisor is a must for millennials who need professional guidance with managing their money.
  7. Tech

    Advisors: The Robots are Coming and Want Your Job

    Advisors always face uncertain markets. Today, however they face technological competition and deciding when they should exit the business altogether.
  8. Tech

    What Advisors Can Learn from Robo-Advisors

    There are several things that advisors can learn from robo-advisors that can help them to effectively scale and grow their businesses. Here are a few.
  9. Tech

    Human Advisors vs. Robo-Advisors: Which is Better?

    When it comes to money management, there isn't a lack of choices. Here's a comparison of services from traditional advisors vs. those of a robo-advisor.
  10. Tech

    Trends Putting The Squeeze On Financial Advisors

    As people change the way they approach and save for retirement, the role of financial advisors is evolving as well.
Trading Center