Technology is fast changing the way we live and the way things are done. In fact, every sector is feeling the disruptive effect of technology and those who are slow to adapt to the changes are left behind in the evolution.
Things that used to be manually done stretching over hours and even days, could be achieved within minutes and this is made possible by a tool all of us possess – mobile phones, powered with internet connectivity. Available statistics shows that as at fourth quarter (Q4) 2018, 172.8 million Nigerians own mobile phones, while 106.4 million were active on internet.
The Nigerian capital market is not left behind in the evolution. It has evolved over time from the days of Call-Over to now fully automated transactions. Dealing members now trade remotely from anywhere in the world without having to come to the trading floor of the Nigerian Stock Exchange, NSE, to execute their trades. So, also it is with investors. Due to possession of mobile/smart phones, investors can also place their orders themselves from anywhere in the world and this is the cheering news for youths on the move and other tech-savvy individuals who hitherto were restricted by location and time.
This evolution is anchored by the Online Apps developed by dealing member firms in the Nigerian Stock Exchange, NSE, that now allow people to buy and sell shares with the approval of their stockbrokers. Unfortunately, the number of people accessing the stock market, especially the young population is low, even with availability of platforms like this. Data from Nigeria Deposit Insurance Corporation (NDIC) on age distribution of investment in the market shows that investors between the ages of 25 and 34 make up only 8.1 percent of investors in the equities market, while ages 15 to 24 (mostly, parents driven) account for just 0.9 percent of the investors, leaving room for more of the younger generation of investors to participate in the market.
So, how can you leverage the online trading platforms provided by many investment firms to access the stock market and what benefit are derivable from this?
“For risk management control, the stockbroker validates the order before it gets to the trading engine of the Exchange. If it is a buy or sell order, it will be taken, only that the stockbrokers okays the order. However, depending on the type of subscription, an investor can, as well, put in the order and it goes directly to the trading engine, but the danger in this is that the investor is not seeing the entire market, he is seeing only the stock he is placing the order on,” he explained.
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