This is best reflected by the highly volatile but lucrative Forex market, which reported daily trading volumes of $5.09 trillion across three, separate sessions back last month. Given that this figure was estimated at $4.84 trillion back in January, the foreign exchange is clearly a growth market with a dwindling number of barriers to entry.
Much of this growth can be traced back to the emergence of online trading, which has created a virtual platform from which anyone can trade on the financial market. This has also been the trigger for a wider evolution in the marketplace, which has become increasingly diverse and popular as a growing number of demographics have tried their hands at financial trading.
The Rise and Rise of Online Trading
Historically, the financial market (and particularly complex derivative assets such as currency) were seen as decidedly complex and exclusive to professional traders. The financial markets were also seen as the preserve of large corporation, who would their resources to trade profitably and make significant gains over time.
The emergence of online trading changed this, however, primarily by negating the need for a third-party broker.
Traders could subsequently use a comprehensive online platform to manage their accounts and execute trades in real-time, while also accessing live news and in-depth trend analysis as and when it was required.
Instantly, this removed the single largest barrier to entry surrounding the financial markets, while it also made the concept of trading volatile assets such as currency (and similar derivatives) increasingly viable for part-time investors.
As online trading platforms became increasingly sophisticated, we began to see further improvements (both in the range of viable assets and the way in which traders operate).
Relatively simple but previously unheralded investment vehicles such as ‘spreadbetting’ became extremely popular among new trading demographics, for example, as it provided a simple method through which people could profit from complex markets such as foreign exchange.
Essentially, this practice allows investors to speculate on the performance of one currency in relation to another, which in turn makes it possible to profit in a volatile (and even depreciating) market.
In short, online trading platforms not only brought financial market trading to the mass-market, but it also created a more even playing field for both experienced and novice investors alike.
Trading methods such as spreadbetting have been central to this evolution, as has the ability of investors to source information and execute trades in real-time.
The Popular Vote: Online Trading, Spreadbetting and Popular Culture
The rising prominence of online trading and virtual brokerage brands has also impacted on popular culture, marking the final stage of the financial market’s evolution.
In recent times, we have seen a rising number of celebrities endorse the market leading platforms and brands, including Portuguese footballer Cristiano Ronaldo and tennis legend Boris Becker. Most recently, La Liga side Atletico Madrid announced that they were to sign a two-year sponsorship deal with financial trading outlet Plus500, which will net the Spanish club an estimated 11 million Euros annually in additional revenue.
This will lead to even more intense levels of competition within the online trading sector, while technological advancement will ensure that investors have access to an ever-expanding suite of analytical tools in the future.
All things considered, the evolution of the financial marketplace has followed a predictable course, as technology has eroded once insurmountable barriers to entry while bringing trading into the mainstream. As a result of this, financial market trading is now considered to be a viable way of earning additional income for everyday citizens, rather than the closed and complex discipline that it once was.
Perhaps the biggest blow that has been dealt to the pound and the GBP/USD, however, is the revelation that May and her largely Eurosceptic cabinet would most likely pursue a ‘hard’ Brexit.
This would mean severing all ties with the single market, which in turn would have a significant economic impact for customers and business-owners alike. The mere prospect of this has sent the GBP/USD sliding further, as it dropped a staggering 270 points last week before the pair closed at 1.2174.