A couple of Christmases ago, I received a book called “The World We Made”, which is a vision of the future in 2050 of a world where humankind has solved many of the environmental, political and economic problems we face today.
It’s a world where 90% of energy comes from renewable resources … where plastics are made from algae-based materials … and technology has enabled farming success in previously inhabitable parts of Africa.
Of course, the book is fantasy. But the predictions are based on current science, and aren’t outside the realms of progress.
In the face of daily doom and gloom on the news, it’s easy to overlook the huge positive progress the world has made, in reducing disease, poverty, terrorism, authoritarian regimes. The planet is considerably safer than it was just 30 years ago.
Nothing is more responsible for the ‘good old days’ than a bad memory.
So, if we really look at what trading was like just a few years back, we may start to see how lucky we are.
Not so long ago, even the most basic data feeds had to be paid for. They were expensive, and could be intermittent.
Now, we get access to accurate pricing over the Internet. And leading software and platforms allow fast access to these markets.
A touch of a button tells your broker that you want to buy or sell, and modern methods of spread betting make this incredibly cheap and tax efficient.
It’s easy to forget just how different this is to trading just a couple of decades ago, when monitoring prices and contacting brokers was a real chore.
Another bonus is how simple it is to test strategies.
While back-testing software and demo accounts do have limitations, they make the first steps of development fast and easy. We can test out ideas quickly to see if they are viable.
Fast-flowing data and high-speed algorithms are blamed for a lot of woes among traders. But the reality is that – if you’re a home trader – someone was always going to have faster, easier access to the markets than you. We shouldn’t kid ourselves that it’s a new phenomenon. It’s a fact of life that’s been paying for Lamborghinis and long lunches in the City for decades.
Despite the odd flash crash, fast-flowing data makes markets more efficient, and ultimately a fairer playing field.
This is an incredible time to be trading the markets.
The opportunities … the range of markets … the low costs …
… and the increased volatility we’re experiencing at the moment.
Rather than grumbling, we should be feeling like kids in a sweetshop. Of course, that sweetshop feeling means we can be tempted to be reckless – it’s too easy, too cheap, too volatile.
So, enjoy these times – we may look back on them as a golden age of opportunity. Don’t squander them by overstretching yourself – or, even worse, by sitting on the sidelines.
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