Big Data Analytics Has Potential to Massively Disrupt the Stock Market

By Sean Mallon | March 13, 2021

Big data is changing the nature of the financial industry in countless ways. The market for data analytics in the banking industry alone is expected to be worth $5.4 billion by 2026. However, the impact of big data on the stock market is likely to be even greater.

Automated trading software is fast changing the approach a lot of individuals take to investing. A good example of this, an investment strategy like Fibonacci trading uses the Fibonacci sequence. The strategy is a reflection of nature since it orders the structures in line with the Fibonacci sequence.

Traders have been using this strategy for quite some time. The issue is that traders who would manually work with Fibonacci ratios also had to fight their personal emotions. A strategy based on Fibonacci is an effective one, but then emotions creep in, making investors believe they’ve got a hot hand. They’ll make an alteration to their strategies as a result of errors resulting from emotions. Big data algorithms that understand these principles can use them to forecast the direction of the stock market.

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