How Fintech Is Challenging Wall Street

In 2013, Robinhood opened up a whole new market of investors. Now a new wave of fintech is on the scene making it easier than ever before for retail investors to get a leg up.

In 2013, Robinhood opened up a whole new market of investors. While we can certainly tip our hats to brokers like Charles Schwab for setting the low-commission trading trend, Robinhood took it further with an easy-to-use interface and a commission-free trading platform.

Robinhood redefined who traditional investors are and gave thousands of people open access to the stock market.

Fintech’s influence is continually encroaching on the finance world. This movement is arming today’s retail investor with every basic resource powerful Wall Street firms have. We’re entering a golden age where retail investors can sit comfortably in online investment communities exchanging ideas, getting stock picks, and making trades on their phones.

The crazy thing? It’s actually working.

Remember GameStop?

The spike in active investment strategies over the last few years can certainly be traced back to the rise in millennial-focused brokerage accounts hitting the market. Platforms like Robinhood feed off of the stock market romance that attracts younger generations looking to make a quick buck without working too hard.

But really, who can blame them?

While the 2008 financial crisis is certainly ingrained in the minds of Baby Boomers, younger generations who never lost a dime have their feet pressed down firmly on the gas. Millennials and Gen Z are far more likely to place risky trades than previous generations who saw serious financial collapses over their lifetimes.

According to Plaid’s recent consumer survey, 95% of millennials have adopted Fintech into their lives. This is no surprise for a generation that practically grew up adapting to a new social platform, device, or piece of technology nearly every year. Next to millennials, this survey found that Baby Boomers are actually becoming the fastest growing demographic to adopt Fintech. After all, better late than never!

Plaid also found that overall, 71% of the people they surveyed said they were comfortable discussing their finances socially. This indicates the popularity and strength of online communities banding together to make successful trades.

Technology has broadened the perspectives of retail investors everywhere, providing instant access to critical information and trading platforms that are easy to use. The plug-and-play nature of most digital brokers is actively challenging Wall Street’s dominance over the stock market.

And we’re not stopping at individual stock trading either…

Online brokerages like Robinhood originally opened up the door for retail investors to trade stocks. However, prior to tools like Olive, investors who lacked the knowledge and experience have fallen off of a financial cliff. Today, Olive is not only opening the door, but building guard rails so retail investors don’t crash and burn.  

New and improved platforms like Olive are doing exactly what early Fintech pioneers accomplished years ago; establishing a whole new marketplace and demographic of investors. But this time, doing it better.

As Fintech expands into new areas like options trading or futures, Wall Street’s dominance will continue to be challenged. As retail investors become savvier, who knows what the limits are as more people adopt this technology?

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