What changes Internet brought?

Different way of Internet trading: Computers and mobile devices. 

Today, the Internet has brought billions of individuals into a global computer network. Everything started in 1995, when the use of the Internet for general commercial activities started. After that, a rally started in terms of Internet usage for business-to-business operations.

During the first three years, electronic commerce between businesses over the Internet amounted to $43 billion, while consumer transactions amounted to $8 billion.

The financial market has also seen a radical change. One of the indicators was the apparition of Internet banking. Internet banking is described as the use of the Internet as a delivery channel for banking services, which include traditional services such as opening a deposit account or transferring funds between different accounts and new banking services, such as electronic bill presentment and payment (Jun and Cai, 2001).

Additionally, the Internet alters the way information reaches an investor. The quantity of information is exponentially larger in a shorter amount of time, dramatically decreasing the fixed and marginal costs of the production of financial services.

Additionally, the advancement of ICT has helped many small sized online brokerage companies. Also the financial market has seen more and more new investors who are beginners, a fact caused by the generalization mass trading because of the Internet. Prior to the mid nineties, the market was limited to trained and informed professional investors, but after the generalization of connections means to financial networks, the public has access to financial markets through “The direct placing order”. The intermediaries have been eliminated by the propagation of this process, and one may conclude that the investor has an obvious and quantifiable gain by reducing trading and execution costs.

Also the ICT gave investors a very large amount of information and advice concerning with a real time update. The problem is with the overwhelming amount of information, it has become difficult to distinguish between the correct and useful information and a manipulation attempt.

Finally, Internet has facilitated real time comparisons due to by the exponential speed at which investors receive information. This created a new tendency for short term trading in comparison to medium term trading that was effectuated available before. The reason is that investors now are able to check the status of their investments instantly via computers and wireless devices compared to the traditional financial newspapers couple of years ago. The implementation of new technologies has facilitated the speculation dot.com bubble since the 2000, which has influenced the economy lately leading to the last financial crisis.