After the Robinhood case, everything looks like a game
If technology has made the most unthinkable activities accessible to everyone, it is also true that it has simplified some aspects of our lives to the point of making them almost playful, fun, and attractive when, not so long ago, we might have considered them boring. This is the case of the world of investments that has moved ever more from banks to online platforms and has then been pumped up thanks to the introduction of cryptocurrencies that intrigued many, causing interest in this world and consequently in the world of economics and finance.
As time goes by, investment apps have also become increasingly popular, allowing users to invest even small amounts of money, such as just 5 dollars. All this has also affected the younger generation, stimulating them to invest.
However, things move fast, and even classic investments become available to everyone thanks to apps like Robinhood which has become famous, especially recently, for the Gamestop case where small investors managed to drive up the value of the video game company’s shares, a Company by now considered in decline, before the main trading platforms blocked further purchases of the stock.
Robinhood is an American app, not yet available in Europe, that has spread widely among amateur investors, especially because it’s commission-free and without minimum investment limits, thus ensuring that you can get shares even with a few dollars. However, it must be said that the app isn’t exactly new: in fact, it was born in 2013, but it has spread widely in the last period, perhaps thanks to the lockdown, which provided more free time to spend at home, making more investors interested.
Despite the simplification and facilitation of certain mechanisms may allow everyone to access the world of investments, the downside, according to many, is the so-called ‘gamification’ of the stock market, namely, to make it too ‘playful’, as if it were a kind of video game, thanks to an attractive and engaging UI that gives at the same time, the impression of dealing with a social.
As a consequence of underestimating the risks, there may be a loss of huge amounts of money, often followed by extreme psychological reactions, such as suicide.
It must be said that nowadays, all young people have a smartphone in their hands from which they can access any type of app, so they are widely exposed to all the risks of having powerful tools at their disposal, used without awareness, can entail, not only for themselves but also for others: consider cases in which children use their parents’ credit card without their knowledge, for example.
Nevertheless, even adults are not risk-free, nor may we be if we entrust investments to Artificial intelligence: will it be more reliable than people or riskier? It is difficult to give a clear answer.
In the end, investments within everyone’s reach can be an excellent opportunity to increase one’s wealth, but we must not get carried away with the idea of becoming rich as quickly as possible, otherwise, we risk creating more problems than when we started. In addition, it would be a good idea to limit the possibility of making major investments by people who are too young until they are able to understand the extent of the risks involved. For them, it would be better to invest small sums and establish maximum losses upstream, so that they can understand the instrument without incurring unpleasant consequences.
However, there is another question: can small amateur investors (consciously or not) influence the financial market at the expense of the expectations of big investors? This scenario certainly opens up pros and cons, since if, on the one hand, there can be financial democratization in which the big investors are no longer the ones who rule; on the other hand, if finance becomes like a meme or a viral video, where one acts almost by instinct, the results could be shocking, a bit like fake news that becomes reality only because it is the most widespread.
