BERLIN: Trading apps make it easy to follow financial markets and buy and sell stocks, ETFs, bonds and crypto directly from your smartphone. It's problematic, however, if trading becomes compulsive or, at worst, an addiction.
International financial watchdogs have sounded the alarm over the addictive design of smartphone brokers. In a global study last year, the International Organization of Securities Commissions (IOSCO) warned that mobile apps increasingly rely on gamification – such as celebratory alerts and instant reward systems – which can distort users' perception of risk and fuel compulsive trading.
Not uncommonly, this leads to large financial losses. Who can help?
"The partner or family members play a key role," says Dr Falk Kiefer, president of the German Society for Addiction Research and medical director of the Clinic for Addictive Behaviour and Addiction Medicine at the Central Institute of Mental Health in Mannheim, Germany.
He advises that they speak calmly and respectfully to the compulsive trader, for example with the words: "I'm worried about you," "You can't be reached – profits and losses are all that matter to you," or "I'd like to help you."
The second step should be to offer the person help by saying something like, "Let's sit down together and look at your profits and losses," or "Let's figure out together how you can get rid of this compulsive behaviour."
Another option is to go together to an addiction counselling centre, psychosocial counselling centre or an outpatient addiction clinic.
"It's important," Kiefer says, "for the partner or family member to let the person know: 'You're not alone, I'll help you, and together we'll reach our goal.'"
The boom in smartphone trading has transformed retail investing across Western countries in recent years.
Low-cost neo-brokers such as Trade Republic and Scalable Capital have gained millions of users by removing minimum deposit thresholds, slashing transaction fees and offering commission-free monthly savings plans directly via mobile devices. – dpa
