The role played by technology in driving capital markets

The use of paper based transacting methods and its associated shortcomings that include but not limited to risk of loss of documents of title, delays due to movements of paper documents between different offices and different participants is slowly but surely fading away. Technology has enabled the introduction of innovative products and services that are making capital markets more attractive to investors and those seeking savings opportunities.

For many years securities exchanges were physical locations where stockbrokers met and used the open cry method to negotiate on behalf of buyers and sellers. Exchange trading typically happened on the floor of an exchange. With the improvement in communications technology in the late 20 th century, the need for a physical location became less important and traders started to transact from remote locations over the web or on wide area networks.

Since the creation of NASDAQ as the first electronic exchange in 1971 exciting trends are emerging in financial technology, and the advances are touching every part of the traditional capital market industry.

There is so much innovation going on in the capital market that by partnering to fully participate in that innovation, market participants begin to realise a distinct competitive advantage.

Today, thanks to technological advances, transactions are easier to complete, monitor, clear, and settle and this is helping to spur the development of the capital markets. Order handling has largely become automated for retail and institutional investors. Securities dealers are using the internet to communicate with investors and to offer and distribute securities. Corporate issuers, large and small, are conducting offers online and investors are also trading securities online.

The Zimbabwe securities market has not remained stagnant but has also adopted technological innovations providing tremendous advantages to all capital market participants. The country’s capital markets sector provide a complete electronic platform for the issuance, holding, trading and settlement of securities. This development will allow securities dealers to ride on the technological wave and match buyers and sellers in real-time and remotely.

Through C-TRADE investors are now able to participate on the exchange in real-time through mobile phones and personal computers. Investors can buy or sell shares anytime, anywhere. The use of wireless technologies in shares trading is now allowing investors to access trading platforms, from mobile phones rather than being confined to traditional trading methods. This technology provides easier access for smartphone users to actively manage their portfolios on the go.

The introduction continued growth of technology will present even greater opportunities for expansion and innovation in capital markets especially as investors become more wired and more comfortable with communication technologies. The effects will be felt throughout the capital markets sector and will redefine the way shares are issued, traded and settled. An increased number of investors, especially retail investors is also expected to actively increase the number of investors participating in securities trading as a result of the convenience, security and efficiency brought by technology.

C-TRADE will continue investing in technological advancements for the development of our markets and for the benefit of both current and future investors.

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