Nowadays, all it takes to start and control your own investing empire is a smartphone, a laptop computer and an internet connection (and of course the capital) and you are ready to manage your investments from anywhere in the world. But what seems easy can be made easier.
Chances are, if you’re investing online, you are already somewhat digitally savvy, but there are some digital skills that can make the process even more streamlined for you. Below are 4 digital competencies to help simplify how you invest and keep track of your finances.
Excel Skills
Most people who have worked in an office environment during the 21st century know quite well what Microsoft Excel does, but few have an in-depth understanding of exactly what Excel is. Microsoft’s Excel program is a sophisticated data collection and analysis tool. It is not merely useful for organization and converting the occasional table into a graph.
If you are serious about spending a lot of time investing online, improving your Excel abilities is something that should be at the top of your list of priorities. Excel can be used to gather and organize information that you might need to make an investment decision, it can find and show you patterns in the kinds of stocks you are picking and how and where you are losing or making money, among many other things.
Cybersecurity
In order to be a safe and competent investor in this day and age, you also need to be aware of the many cybersecurity threats and vulnerabilities that exist while investing online and how to plan for and mitigate them. Investing in the third decade of the 21st century involves a plethora of applications, passwords, linked accounts, and the collection of sensitive financial and personal data by all of the many companies you are interfacing with when trading financial instruments online.
Each digital relationship and point of contact with the web represents a potential entry point for thieves and cybercriminals looking to access and intercept that data. If you are investing in and trading assets like cryptocurrencies, which are uninsured and purely digital, you risk losing everything with nothing to be done about it. A recent bust in Europe has seen 10 individuals detained in a hacking ring that stole 100 million dollars in cryptocurrencies last year. All of the people they robbed, once those coins are sold, have no recourse.
Protecting yourself while you trade online means doing things like implement two-factor authentication to make it harder for hackers to gain access to your accounts; avoiding trading and accessing bank accounts while using open networks in places like airports, hotels and cafes; using a virtual private network to encrypt your data whenever possible; backing up your data in the event of theft or catastrophic loss; proper password and security information storage; using a firewall, and staying abreast of the latest cybersecurity developments and stories by reading leading publications and blogs.
Digital Multitasking
If you invest, and particularly if you day trade, being able to digitally multitask is a key skill. This means an ability to switch between screens, devices, applications and platforms and being able to rapidly shift your focus when needed. While constantly switching focus is not always the best thing for your ability to concentrate and focus, knowing how to turn it on when you need to is key for investing in the markets.
For many non-Digital Natives, this is a skill that can be hard to acquire. For those investors who came of age during the internet and web 2.0 eras and are accustomed to using various software and hardware at the same time in their daily lives, this digital skill comes much easier.
Research and Information Collection
The success of your investments comes down to an admixture of timing, information and often luck. While this last one is not up to you, how and where you get your information, and how quickly you are able to find it and synthesize it, can have a major impact on how your investments perform.
Being able to find reliable sources of information and effectively incorporate them into your investment decisions is a digital skill that is acquired over time and by constantly staying on the lookout for new sources of data, wisdom and market insight. You can make use of content aggregators like Feedly to help organize your daily reading and provide you with a database from which to browse for and identify new investment opportunities.
Conclusion
Most people, when they get to a certain level of capital accumulation, are determined to put it somewhere where it is likely to earn them a decent return year-over-year. Money left sitting in a savings or checking account is only going to lose value due to inflation, so prudent money management would dictate you invest it somewhere. Whether that is the market, into real estate, or anywhere else, the above digital skills will make your investing easier, better organized, safer and all-around more enjoyable.
