Post pandemic trading - What to expect?

How will expectations change as markets move towards a post pandemic world? Here’s what you need to know.

December 23, 2020 8:16 IST | India Infoline News Service
In recent history, there has not been an event as widespread in its scope and impact on the world as the Covid-19 pandemic. The global crisis caused by the pandemic has been largely humanitarian, but it has also had far-reaching effects in other aspects of our lives. One of the most substantial aspects of the world in which the pandemic has played a part is economic activity, both local and global.

As the definition of business changes in the post pandemic world, it is important to assess what this economic evolution means for the world of trading at large. The stock market and its many participants are eager to assess how this new landscape affects the ways in which trading is conducted as well as where the market might be headed next. If you too fall in this category, here are a few salient points on what to expect in the world of post pandemic trading:
Increased Digitalisation
The first and possibly the most important transformation witnessed by post pandemic trading would be the increased adoption of digitalisation. Even before the pandemic struck, the trend in most financial markets was already headed towards improving ease of operation through technological means. However, pandemic-induced lockdowns and social distancing measures necessitated the use of digital tools to keep trading afloat.

This means that trading at large will now move towards increased virtualisation in order to adapt and stay prepared for an event with a scope as large as a pandemic. Business and trading practices, including transactions, meetings, legal discussions and events, will now move towards digitalisation. While on the one hand this means that there will be less face-to-face interaction in trading, it also means that the world of trading will improve in terms of speed, scale as well as scope.

New emerging industries
The aforementioned move towards digitalisation will also have an impact on the industries that facilitate this change. The restrictions imposed upon not just the trading industry, but the working public at large, has provided immense opportunities to sectors that were prepared to fulfill the demands of the changing world.

This includes digital tools and platforms that aided in virtual communication and helped businesses in coordinating with their teams. It also includes platforms that made it easier for people to fulfill daily requirements through digital means, such as e-commerce platforms, delivery aggregators, e-learning and online teaching platforms, cybersecurity, entertainment streaming services and more. As the lockdown provided these industries an opportunity to demonstrate their usefulness and have their time in the sun, they will go on to generate a renewed interest in the market.
Changes in business landscape
The pandemic and its resulting impact has also made some major changes to the business landscape at large - some temporary while others permanent. While some companies flourished due to opportunities or innovative business strategies, others revealed their pitfalls, leading some businesses to exit the market entirely. This means that as industries that were considered major players are dethroned and new players enter the market, many previous assessments of the market will need to be reanalysed.
Implementing specific learnings from the pandemic

The pandemic was not only a teaching experience for businesses and industries but also for individual traders and trading at large. That is why the hard-won lessons learned by traders during the pandemic are likely to carry over into their trading preferences and practices in the future.

For instance, traders discovered that the market was particularly hard on companies with large amounts of debt as well as considerable physical assets. They also discovered that companies that prioritised resilience over cost-cutting seemed to have sailed through the pandemic better. It is possible that these lessons could translate into individual preferences as traders make the picks in their portfolio.

As world economies recover from the impact of the pandemic, markets will find a way to not only survive, but also thrive in a matter of time. While some aspects of post pandemic trading might be harder to predict, the aforementioned features are certainly some of the most essential. Most important among them is the need for trading practices to be digitalised, which is why online discount brokers and the accessible tools they offer is a good option to consider. These digital tools and platforms facilitate transactions online, with automated features and incredible ease of access, making them ideal for post pandemic, new age traders.

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