The rise of gamification in the trading sector
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Trading and investing has been experiencing a wave of popularity around the world in recent years, especially among younger people. However, it is a complex field that remains obscure and difficult, even for the most seasoned traders.
In simple terms, trading can be described as speculation on the financial markets, and taking advantage of fluctuations to make gains. This activity can be carried out in many areas of finance: shares, stocks on the stock market, currencies, Forex trading, and crypto-currencies, among others. Many investors have classically used stockbrokers, so that they don’t have to manage the operational side of trading. However, it is possible to work out a winning strategy without necessarily using these intermediaries.
How? Through gamification. Gamification offers trading companies ways to incentivise new traders to commit to their apps, explore their features, and educate them on how to improve at trading. For customers, or would-be traders, it opens up new opportunities, and simplifies a typically complex and previously hard to access world of financial opportunity.
Gamification: an interesting solution for the trading sector
Gamification has taken over this complex sector of finance, much as it has with banking, but with the aim of making it more accessible to more people. To gamify something is to apply game mechanics and game design principles to non-gaming contexts. It might be more appropriate to call non-gaming contexts areas that are not typically considered playful, because as will be explained, there are many gaming elements built into so much of what we do. Business and capitalism for example, is a game. There are winners and losers, and a mid-pack of also-rans who get by. Consider the fact that businesses “compete” and call their rivals “competitors.” Perhaps no area of business is more ripe for gamification than trading. Traders are literally playing with markets, and trying to come out of their trades as winners, with more money than they started with. At its most sophisticated, it’s highly educated gambling.
A gamified format that works on a smartphone app is ideal for simplifying and enhancing learning, while allowing new users, especially younger ones, to enter this world that has historically been gate-keepered by intermediaries. Until a few years ago, it was necessary to have a financial analyst’s training to understand how market movements actually work, or do a lot of independent research.
Gamification in trading
Whether it’s by using video game mechanics and game design elements to educate new traders in a more user-friendly way, much as gamification has been used to educate students and train workers, or focusing on the psychological motivator of challenge, and constructing gamified content through an app for building a trading routine, gamification brings a much larger audience to this sector. Thanks to the intuitive and playful interfaces you can create through games creation platforms, budding Bud Foxes and wannabe Gordon Gekkos can copy the moves of the greatest traders in order to adopt their winning strategies.
The longevity and ethics of gamification in trading
In the face of certain high-profile operations such as the GameStop short squeeze, the question of the legitimacy and longevity of the gamification model is raised. However, the main leader in this sector, Robinhood, a financial services company, does not seem to be worried about the subject because users and players are growing in number.
Ultimately, gamifying content, for both training and education, and structuring trades in the trading sector is a playing field leveller and a force for good. The democratisation of access to trading platforms for a broader range of customers, the numerous training courses available online on this subject, and the digitalisation of new audiences, are all factors that call for the use of gamification across trading.
Examples of gamification in trading
Obviously, building out a whole gamified app from scratch is an incredibly complicated endeavour requiring coding knowledge, significant financial investment, and the necessary time to completely reinvent your infrastructure. However, through a gamification platform like Drimify, you have access to a number of tried-and-tested game engines which can be customised to complement the trading activities of your customers. They are all designed mobile-first, so can be played on any modern device, and offer easy integration across platforms.
Here are some examples to use as jumping off points for your own gamification projects.
Instant win games to encourage retention
For better retention, and to encourage a longer-term approach to trading, you could offer an instant win game like a Wheel of Fortune. Every time a customer spends, say, £50 on a trade, you could give them the opportunity to win their next £50 trade on another spin.
This is essentially sweetening the pot for the user. A limited time introductory offer where there are a limited number of free trades to be won, with a chance to win every day. This can be an incentive to keep people engaged with your platform and to reward them for being part of your community.
Games to incentivise users to explore all aspects of your app
To encourage your audience to engage with all aspects of your trading app, and by doing so, benefiting their own trading experience and learning more about the industry and how to be successful, you can use games with opportunities to win prizes as an incentive.
For example, if a user puts funds into their account, you can release an access code for them to play a game. They could receive another code to play an exclusive game after they complete their first trade. If they utilise some of your app’s training or educational features, this would also give them a code to play another game. The prizes could be monetary, or take the form of funds in their account specifically to complete another trade.
This kind of approach encourages your user to use your app as you intended it. A better informed user is a more successful user, and a more successful user is a happier user.
How do you choose a winning trading strategy?
First of all, there is no magic formula for a single winning strategy that works every time. The reality is much more complex. Whether you are a new trader or a more experienced trader and looking for new strategies, it is important to take the time to find systems that work for you.
Before doing so, you should bear in mind that a trading strategy will be very individual, it will depend on your knowledge and skills. It must be adapted to your needs and the risk level you are willing to assume.
Parameters to take into account
In all good trading strategies, there are points to be defined before even registering on an online platform. You will need to determine what time frame you are comfortable with, and choose the market(s) you want to trade on. There’s no need to choose multiple platforms and spread your investment around, you can use a well-known platform like eToro to do your testing.
Start with one platform to develop a strategy that works for you, and educate yourself on the various indicators that can inform your strategy and decision making, such as: moving averages, the relative strength index (RSI), stochastics, and the moving average convergence divergence (MACD), among others.
You will then need to familiarise yourself with the analysis and trends of the chosen markets. This will help you decide when to buy and sell. Once all this experimentation has been done and you have become more skilled and experienced at this exercise, you will need to establish a routine. This is the most important step in sustaining your trading activity to get results over the long term.
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