Cast your mind back to the 1980s, a time when stock markets were flying high, economies were booming, and decadence was in full bloom. Referred by many as the "greed decade", this was a turning point for stock market investment. Private investors, who had long since depended on the advice of experts, began to make their own investment decisions. Then, step forward the movie Wall Street!
Was Wall Street the catalyst for a day trading phenomenon?
The rise and fall of Gordon Gekko, that moment Bud Fox stepped back from the abyss to reclaim the moral high ground,is seen by many as a reflection of the 1980s. Many will be surprised to learn that Wall Street, the movie, was based on real-life scandals, brushes with the law and incarceration. So why did Wall Street attract the attention of private investors?
Blue Horseshoe loves Anacott Steel
Those who have watched the movie will know the infamous phrase "Blue Horseshoe loves Anacott Steel" when traders tried to ramp the share price. This was an era of limited regulation, indeed a form of self-regulation, where insider trading was running riot. It is safe to say that Wall Street, the movie, made day trading seem "sexy", bringing the financial markets into homes up and down the country.
Privatisations in the UK
There is no doubt that Wall Street, the movie, brought financial markets into the front rooms of many homes in the UK. However, the infamous "Tell Sid" British Gas privatisation campaign still lives long in the memory.
The privatisation of British Gas was the forerunner to a vast privatisation programme by the Tory government. This led to several previously government-owned operations being sold off, such as:-
• British Steel
• British Petroleum
• Rolls Royce
• British Airways
• Water companies
• Electricity companies
It is safe to say that the UK public bought into the privatisation phenomenon, many banking significant gains on first day dealing prices. Whether this privatisation programme has ultimately been successful is a matter for debate, with many companies going on to bigger and better things. However, it did give the UK public a taste for investment and a growing appetite for risk.
The regulatory framework today is very different
Over the years, we have seen many regulators merge and change names to create a very different and more robust regulatory framework. The days of "self-regulation" are long gone; markets now need to adhere to strict regulations and high levels of transparency. However, it does seem as though movies such as Wall Street spawned a new era in investment, day trading.
Electronic trading replaces the hustle and bustle
Electronic trading has replaced the hustle and bustle of stock market trading floors from the 1980s, dealers jockeying for position, trading on the word of another, often burnt out by the time they reached 30. While we have seen the introduction of more complex financial tools and the banning of other instruments, day trading appears to be enjoying a resurgencedue to the Covid lockdown.
The Internet has revolutionised how research and information are shared amongst investors, institutions and the general public. The ability to do your own research, use execution-only trading services and even manage your own pension funds has created a new dawn, welcomed by many. However, while fashions vary, regulations change, and trading floors have been removed, the concept of day trading remains unchanged.
Remaining competitive
Here at GIS UK Ltd, we invest heavily in our electronic trading services, reducing latency and improving reliability, creating the perfect environment for day trading. This ensures that we can remain competitive on charges while providing a seamless trade to settlement service.