Technology is increasingly defining our everyday lives. A UAE resident, on average, spends more than eight and a half hours(1) on the Internet every day — nearly two hours more than the global average. We use technology to work, connect with friends, relax, shop, bank, and more. But one big way technology impacts our lives is by revolutionizing finances and investments. It is increasingly defining how we invest and what we invest in.
Correlation between Technological investments and New opportunities
Technology becoming increasingly more advanced continuously creates new opportunities for investors. For instance, investment apps and online tools have opened doors for first-time investors to buy and sell stock. Popularly known as “robo-advisors”, such purportedly commission-free trading platforms have democratized financial markets by reducing entry barriers and allowing novice investors to grow their wealth.
Such apps and tools allow new investors to get started with little to no experience or knowledge. They also allow you to purchase stocks with less money than you likely would through a stockbroker. Though the advice is less personalized compared to that from in-person advisors, it is insightful enough to get a good start. Most importantly, robo-advisors are accessible round-the-clock and increasingly expanding their services as part of full-stack models, thereby closing the gaps with traditional advisors.
Thanks to technology, investors now have access to the latest financial news and information, allowing them to make more informed decisions about their investments. Intuitive investment websites and dashboards make tracking stock performance in real time possible, which can be crucial for those looking to make time-sensitive investment decisions.
For example, Big Data and AI (artificial intelligence) provide nuanced information to base investment decisions on. If you’re, for example, looking to invest in real estate assets, a deep dive into the sector could be advantageous. Whether you’re analyzing the costs of homes in the area, securing financing, or simply weighing your options, technology can be beneficial at every step.
Furthermore, the latest technological innovations have also opened opportunities to make new, profitable investments. Savvy investors are jumping on these avenues early, hoping to make hay while the sun shines.
FinTech is charting a new course for financial markets
Artificial intelligence (AI)
While AI has been growing for several years now, it’s still in its nascency compared to its full potential. As it is likely to grow year after year in the future, it merits attention within the investment framework. Experts predict that by 2035, AI use in the financial service sector will contribute more than $37 billion to the economy of the UAE. It will also contribute $22 billion to the healthcare sector and $19 billion to the transport and storage sector.
Another trend to gain exposure to now is cloud computing. Like AI, cloud computing has been on the rise for several years now. But, following the pandemic outbreak and the corresponding increase in remote working, businesses are increasingly turning to cloud-enabled solutions. While the adoption in the finance sector is currently limited to non-core business processes, it is set to expand in the foreseeable future.
Often accompanying AI and cloud computing, smart devices are another rising technology that promises continued growth in the future. Smart devices for residential use (PropTech) have become the norm in innovation-driven economies, especially in the UAE. Smart sensors are also in high demand in factories and other commercial properties. They induce intelligence in machines, making them more effective and increasing their output and safety. Between 2021 and 2026, the smart sensor market in the UAE is expected to grow by more than $842 million(3).
Likewise, other top innovations that are likely to see significant growth in the coming years include:
- Electric vehicles and electric vehicle batteries
- The metaverse
- 3D printing
- Internet of Things (IoT)
Whether you are leveraging FinTech to invest in stocks and other opportunities or searching for the latest tech-led asset classes to bolster or diversify your portfolio, the trends mentioned above are relevant for veterans and new investors alike. Therefore, staying up-to-date with the latest innovations will allow you to take advantage of existing and future opportunities and, most importantly, stay ahead of the curve.