Category: Markets

Tech World
ArticlesMarkets

Tech Trends to Make You Money This Year

Tech World

Technology has definitely changed the way we live and work. It has made us more efficient in many aspects of our lives and given us opportunities we would never have considered possible 20 years ago, like making money with a device that could fit in our jeans’ pocket. Thanks to this convenience, generating a main or additional income with modern technological tools has never been easier or more accessible.

 

Online Learning Course Sales

Many people are looking to upskill themselves but don’t have the time or money to go to an institution to learn. If you are knowledgeable or qualified about a particular topic, then you can make a good deal of money from curating and uploading courses for other knowledge-hungry people to buy online and follow along with. You can choose to upload your courses in a few different formats, like video, audio, or text. Learners can purchase subscriptions to the content you upload, and you will earn a sum of money each time this happens. However, creating digital content takes a bit of work and will require the use of a decent computer. Workstation Desktops from reputable brands come with a range of hardware options to suit all budgets and needs, so be sure you know what work you will be producing before you pick a machine to make sure it can keep up.

 

Additive Manufacturing (3D Printing)

There is some money to be made in the 3D printing space, but competition is stiff, and customers are often not willing to pay 3D printing rates when bulk-produced injection-molded parts are cheaper. To really carve a profit out of the market, you need to get some 3D design and modeling skills under your belt and focus on a niche audience (it helps to choose something you are interested in too). Beware of printing and selling a design belonging to another creator, as this can land you in some legal trouble. Designing and printing custom jewelry, especially any pieces with mechanical properties, is a great example of this. The cosplay market is another great niche to target, and there is less competition in this space.

 

Blockchain Money Train

Navigating the confusing streets of cryptocurrency for ways to make money can definitely be risky, but it has also proven to be extremely profitable. For example, traders who buy low and sell high could net a tidy profit, if the market is in their favor. Another option is to build your own mining rig to bring in a bit of cash on the side (if power is affordable in your area). Or, why not try cloud mining? By renting cloud computing power without having to outlay the funds for the hardware, you can quickly get mining and make money at minimal risk and with little to no financial outlay.

Looking for additional or alternative income streams is becoming more commonplace as times get tougher and money doesn’t go as far as it used to. Luckily, there are options out there for those willing to put in the time and using technology to your advantage means that you’ll have a better chance at making your sideline work for you.

Investment Markets
ArticlesFundsMarkets

What’s Hot in NFT Market? 5 Trends from Top 2022 NFT Events

Investment Markets

Despite crypto being on a downturn, builders are optimistic about the future, with each NFT meetup gathering more and more creators looking to network, discuss ideas, and talk over novel use cases.

Following the crypto market downturn, skeptics keep painting a gloomy picture of the future. However, Indrė Viltrakytė, leading the WEB3 fashion venture ‘The Rebels’, has shared that market volatility has not dampened the optimism of the builder community. Having participated in the hottest NFT events of 2022, she has shared firsthand insights reflecting the prevailing mood of excitement and the main trends that resonated across different meetups.

 

Events – a backdrop for networking

While most of the NFT conferences’ agendas have an impressive line-up of visionary topics, often they play only a secondary role. The main selling point remains the opportunity to network and blend into the community.

“Since the market is nascent, there are still a lot more questions than there are answers. Therefore, everyone is eager to bounce off ideas of one another, which helps bring clarity and focus to their work,” Viltrakytė commented.

 

Keeping the party going

Despite some painting a ‘doom and gloom’ future for all-things-crypto, Viltrakytė says the NFT creator community remains optimistic about the industry’s future, and it clearly shows in the attitude with which they approach discussions or present ideas.

“Builders that continue traveling to different events to network, learn, exchange ideas as well as present their own are in high spirits and not at all shaken up about the current state of crypto. Everyone is bullish, despite short-term market uncertainty, and being certain that the ‘dark clouds will pass’ keeps the creativity flowing.”

 

Rising number of women builders

In 2021, women accounted for only 16% of the NFT art market. However, the scale is slowly leveling out — Viltrakytė noted a noticeable increase of women attendees in NFT events, keen to present their ideas. In some events, women even outnumbered men, showing their growing interest in WEB3 art and its use cases.

“Not that long ago, the industry had a strong label of being a ‘boys only’ club. Now, albeit slowly, but the predominance of a single gender is clearly diminishing, which is incredibly exciting for a few reasons. First, women are proactively killing the stereotype that they aren’t tech-savvy, and secondly, the more diverse ideas are floating around in the market, the more innovative products are likely to be launched because of it,” she commented.

 

Less chit-chat – more discussion

While most of the NFT events strive to strike a work-play balance, Viltrakytė said flashing lights and glitter paled before workshops and discussions. She noted a few experiences that stood out, one of which was an entire week of mini panels held at the ‘We are Web3’ conference, where women could gather and learn.

“I think this will strongly impact how these events are held next year; less music – more spaces to discuss ideas and network with those who can help bring them to life.”

 

Digital fashion on the world stage

Currently, the topic of WEB3 fashion and digital wearables stands out as one of the key narratives in the NFT scene. According to Viltrakytė, fashion will be an important link between physical and virtual experiences, streamlining entry into the virtual world and helping to create a true-to-self digital identity.

“Digital wearables will play a crucial role in virtual worlds, as they will enable users to create avatars through which they can experience the metaverse. In the grand scheme of things, WEB3 will redefine the fashion industry as we know it in a variety of verticals, including self-expression, social networking, industry’s sustainability, its creative potential, and others,” Viltrakytė commented, noting that the curiosity to explore these possibilities is what led to co-founding ‘The Rebels’.

“WEB3 and NFTs have opened many new doors for both established fashion houses and emerging designers. It is very exciting to be part of the force shaping the future of the industry with ideas that, not that long ago, seemed like science fiction but now are becoming the new reality.”

Stocks
ArticlesMarketsStock Markets

12 Stocks Bought by Freedom Holding CEO, Timur Turlov

Stocks

Timur Turlov, CEO of Freedom Holding Corp., gives investors an inside look into his personal investment portfolio. 

“The stock market correction which has come to pass in recent months is approaching its final phase. This opens up a unique opportunity for investors to buy the stocks that have lost significant value, but retained fundamental reasons for future growth and development”, said Timur Turlov, CEO of Freedom Holding Corp. 

Turlov has gathered a portfolio of 12 companies, each with a potentially interesting investment idea behind it. The expected investment period is between six months and three years with the expected return being 81%. 

 

Companies in Timur Turlov’s portfolio

Snowflake Inc. (SNOW) provides a cloud-based platform that consolidates data in a single source to be able to capture valuable business insights, create applications, and manage and share information. Snowflake remains one of the fastest-growing companies in the market. With a market cap of $45bn (£37bn) and a growth potential of 119%, the target price for one share is $310 (£253). Snowflake has steadily doubled its revenues in recent years and expects revenue growth of 94% to 96% in 2022. 

Crowdstrike Holdings Inc. (CRWD.US) develops information security software and is an industry leader in the $55bn (£45bn) market. Crowdstrike offers cloud-based endpoint security solutions on its Falcon platform. The services are provided on a subscription basis using a SaaS model. Crowdstrike is continuing to perform strongly, exceeding market expectations. In Q4, its revenues rose by 62.7% year-on-year to $431m (£351m) and the average rate of return reached a record $217m (£177m). For FY2023, the company expects revenues of $2.13 to $2.16bn (£1.7 to £1.8bn). Crowdstrike has a market cap of $35bn (£29 bn) with 57% growth potential. The target price for one share is $271 (£221). 

Datadog Inc. (DDOG.US) operates a monitoring and analytics platform for software developers and IT departments. The company had a strong performance in Q1 and is forecasting strong results for 2022. In Q4, Datadog’s revenue grew by 83% year on year to $363m (£296m), aided by the company’s expanding partnership with Amazon Web Services. As of March 31, 2022, Datadog had 2,250 customers with recurring annual revenues of $100,000 (£81,545) or more, up 60% from a year earlier. Datadog has a market cap of $32bn (£26bn) with a growth potential of 72% and a target price of $169 (£138). 

Zscaler Inc. (ZS.US) is a provider of cloud-based information security services with a growth rate above 60%. The company’s Q2 revenue grew by 62.8% year-on-year to $255.56m (£184m), beating expectations of $13.69m (£11.17m). For fiscal 2022, the company forecasts revenue in the range of $1.045 to $1.05bn (£85 to £86m) against expectations of $1.01 billion (£82m) and earnings per share (EPS) in the range of $0.54 to $0.56 (£0.44 to £0.46). Zscaler has a market cap of $21bn (£17bn) with a growth potential of 110% and a target price of $320 (£261). 

Enphase Energy Inc. (ENPH.US) is a supplier of power systems for the solar energy industry. It is a profitable company with high margins and products that outperform competitors. Enphase supplies microinverters that enhance the safety and performance of solar energy systems. The company also has digitally backed home energy storage. Enphase reported Q1 EPS of $0.79 (£0.65), beating market expectations by $0.10 (£0.08), while revenue rose by 46% to a record $441m (£360) for the quarter. The revenue forecast for the current quarter is $490m (£400m) to $520m (£424m). Enphase has a market cap of $20bn (£16bn) with a growth potential of 26% and a target price of $226 (£184). 

ZoomInfo Technologies Inc. (ZI.US) is a developer of an analytics platform for marketing companies. New product launches and geographic expansions are helping ZoomInfo maintain strong revenue growth. In Q1, the company’s revenue grew 57.7% year on year to $242m (£197bn). In February 2022, ZoomInfo launched a new marketing platform, MarketingOS for helping marketers with customer targeting. The company also completed the acquisition of Comparably and Dogpatch Advisors this year. ZoomInfo has a market cap of $17bn (£14bn) with a growth potential of 115% and a target price of $74 (£60). 

MongoDB Inc. (MDB.US) is the leading cloud platform involved in developing and delivering general-purpose databases. MongoDB is strengthening its edge over competitors by expanding its relationship with Amazon Web Services and building applications using a microservices architecture. MongoDB databases are increasingly used for complex transactions, which should increase the company’s overall addressable market.  MongoDB’s revenue grew by 55.8% in Q4, with subscription revenue up by 58%. The company has a market cap of $17m (£14m) with a growth potential of 71% and a target price of $466 (£379). 

Bill.com Holdings Inc. (BILL.US) is a provider of cloud-based software that simplifies and automates complex financial transactions for small and medium-sized businesses. The company continues to show strong growth, up by 179.4% in Q3 FY 2022. By the end of the quarter, the company had 146,600 customers and $55bn (£45bn) in payments processed. For Q4, Bill.com expects revenue in the range of $182.3m to $183.3m (£148m to £149m) versus expectations of $168.77m (£169m). Bill.com has a market cap of $11bn (£9bn) and a growth potential of 113% and a target price of $241 (£196). 

Maravai LifeSiences Inc. (MRVI.US) operates in the natural sciences. The company manufactures products that enable the development of drugs, new vaccines, and diagnostics while supporting medical research in the US and around the world. The company’s key market is expected to show continued growth. The global gene therapy market was valued at $3.8bn (£3bn) in 2019 and is forecast to reach $13bn (£11bn) by 2024. Maravai has a market cap of $8bn (£6.5bn) and a growth potential of 63% and a target price of $44 (£36).  

Avalara Inc. (AVLR.US) offers cloud-based transactional tax compliance solutions worldwide. Although Avalara has achieved annual revenues of nearly $1bn (£81m) the company still manages to grow that figure by more than 30% year on year – a testament to the large size of its market and the newness of its technology. More than 90% of Avalara’s base revenue comes from subscriptions, which provides the company with a very stable income. Avalara Inc. has a market cap of $6bn (£5bn) and a growth potential of 70% and a target price of $124 (£101).

Shockwave Medical Inc. (SWAV.US) develops and supplies technology for the treatment of cardiovascular disease. The company shows triple-digit revenue growth and revises its outlook for the year. In Q1, its revenue grew by 193.4% year-on-year. In February 2021, Shockwave launched a new coronary product, which has become a revenue growth driver. Shockwave Medical Inc. has a market cap of $5bn (£4bn) and a growth potential of 28% and a target price of $189 (£154).

Taskus Inc. (TASK.US) provides outsourced digital business services for fast-growing technology companies to represent, protect and grow their brands. Taskus continues to show rapid revenue growth, rising from 34% in Q2 2020 to 56.8% in Q1 of 2022. The retention rate in 2021 was 141%. Taskus Inc. has a market cap of $2bn (£1.6bn) and a growth potential of 130% and a target price of $39 (£32).

Stock split
ArticlesMarketsStock Markets

Stock Splits: The Perfect Buy for Investors

Stock split

As the market takes a plunge, Maxim Manturov, Head of Investment Advice at Freedom Finance Europe, discusses the benefits and pitfalls of stock splits and explores some past examples.

With shares struggling amid a market downturn, some organisations are looking to split their stock to attract new investors. But why?

The main reasons for splits are to make securities more accessible and attractive to the private investor. The next reason is to increase liquidity, which grows by increasing the number of stocks outstanding. When a split is announced, most stocks show a positive trend, and after the split has taken place, the stock trend can turn into a temporary consolidation, as big players can lock in profits on the stock by selling the stock already at the ‘new price’ to retail investors.

With this in mind, are stock splits a good idea and how should investors react if a company chooses to split?

 

Three recent splits 

 

Tesla 

Tesla held a stock split in August 2020 where it’s stock rose by $223 (80%) in just 20 days. After the split ended, the stock price was adjusted from around $2200 to $440. Thereafter, after a slight consolidation, Tesla stock continued to rise. With the market in decline, Tesla has now announced another split, which will be taking place this summer. Tesla’s Q1 2022 report is looking positive with revenue of $18.75 billion, net income of $3.31 billion, for the same period in 2021 – $438 million, and EPS of $2.86 ($0.93 a year earlier). The company has also announced plans to expand its production capacity in Berlin. Yet still, on June 10, 2022, the company announced a 3:1 split and the stock will be valued at about $230. On Friday, Tesla stocks gained 1.84% to $709 on the NASDAQ post-market but continued to decline further.

The drop has more to do with overall market weakness. And if you compare it to the split in August 2020, when the stock price rose a couple of hundred percent, the market was rising then, but now it’s falling. 

 

NVIDIA 

NVIDIA made its fifth split in July 2021, with a 4:1 ratio, their value dropping from $750 to $187.50. In 2021, by the time of the split, Nvidia’s capitalisation had already increased by 32% due to success in all business lines. The company’s quarterly report revealed its net income was $1.91 billion (same quarter 2020 – $917 million) and revenue reached $5.66 billion (+ 83.8% YoY). From the current situation we can conclude that the continued growth of the company’s stock is further driven by both good quarterly results and external factors, e.g., the mining boom, respectively video card shortage, and growth of the stock.

 

Apple 

The fifth Apple split took place on 31 August 2020. This was a 4:1 split, which resulted in the number of stocks in the company quadrupling. The stock price was adjusted from around $500 to $125 per stock after the split was completed. The stocks then consolidated in the $110-$120 range for a while, after which the rally continued. Looking at the company’s financials, the quarterly report on July 2020 showed revenues at a record $59 billion.

 

How effective are splits?

It’s clear to see how the Tesla, NVIDIA, and Apple splits in 2020-2021 had a major impact on share prices, which continued to rise after some consolidation. However, it’s important to remember that there are numerous factors that affect a split, which include internal factors such as a company’s performance (performance report, company management). There are also external causes that do not depend on the company’s activity that end up having a primary influence, such as global market trends (inflation, production cuts, international restrictions, interest rates, world inflation). When business leaders decide to split a company, it is very important they choose the right time, considering the market trends. The main purpose of a split is to make the company’s stock more attractive to ordinary investors. While the value of each stock decreases, the capitalisation of the company remains at the same level and the securities become more liquid.

Stormy Market
ArticlesMarkets

Dividend Aristocrats: A Safe Haven In a Stormy Market

Stormy Market

With the market continuing to take a turn for the worst, Maxim Manturov, Head of Investment Advice at Freedom Finance Europe, explores three dividend aristocrats as a potential safe haven for investors wanting to see steady cash flow within a time of uncertainty.  

In times of market turbulence, one of the safest investments is in the so-called dividend aristocrats — companies that have consistently paid and raised dividends for more than 25 consecutive years. Today only 65 companies belong to this exclusive club. Although many dividend aristocrats are not high-yield investments, they provide their shareholders with a steady cash flow, even in domestic and global economic crises. We have selected three of the most undervalued dividend aristocrats for investors to consider.

 

Three dividend aristocrats for investors 

Polaris (PII) specialises in the manufacture and sale of high-capacity off-road vehicles and snowmobiles, motorbikes, and powerboats. Unlike most dividend aristocrats, the company has not yet reached its financial maturity: its revenues have grown at an average annual rate of 12.03% over the past five years. At the same time, management believes that sales will grow by an average of 7% to 9% a year over the next five years, and the customer base could grow by 50% over the next ten years. Notably, the fastest-growing segment of the company’s customer base is millennials.

In addition to revenue growth, Polaris maintains a high level of efficiency. In the most recent reporting period, return on assets (ROA) reached 8.38%, and return on equity (ROE) was 39.46%. The company can maintain high profitability thanks to its strong competitive positioning and leadership in its target markets.

Two years ago, Polaris earned its status as a dividend aristocrat. The company delivers a dividend yield of 2.57% with a payout ratio of 31.12%. However, dividends are not the only tool Polaris uses to reward shareholders. Through buybacks, the company’s management plans to reduce the number of shares by at least 10% over the next five years. Wall Street analysts value the stock at £107.43 ($131), implying a 29.7% upside potential.

 

V.F. Corporation (VFC) specialises in manufacturing, marketing, and selling branded clothing, footwear, and related products in North and South America, Europe, and the Asia Pacific. The company’s portfolio includes well-known brands such as The North Face, Timberland, Vans, and Supreme. In its long history, VFC has survived 24 economic recessions, two depressions, three financial crises, inflation from -2.5% to 20%, interest rates from 0% to 20%, 11 bear markets, and dozens of corrections and rebounds. That said, the company continues to thrive.

Despite short-term disruptions due to supply chain issues and economic weakness in China, we believe that VFS will grow faster than most competitors and maintain its brand recognition advantage in the longer term. As a result, management forecasts that sales will grow by an average of 7 to 8% in the coming years. 

VFS generates more than £857 million ($1bn) a year in free cash flow on equity, and its capital expenditure has averaged just 2% of sales over the past decade. Thus, the company is accumulating significant cash flow to expand its brand portfolio further.

VFC has a solid track record of returning cash to shareholders. The company has steadily increased its dividend over the past 50 years. The current yield is 4.18%, with a payout ratio of 68.64%. At the same time, management has voiced a target to provide shareholders with a compound return of 14% to 16% in the coming years through dividends and buybacks. The average price target from investment banks is £48 ($59), implying a growth potential of 27.8%.  

 

Walmart (WMT) is an American company that operates the world’s largest wholesale and retail chain, dating back to 1962. Walmart’s retail network includes more than 10,000 shops in 27 countries. 

Walmart has several growth drivers in the long term: the company’s e-commerce segment is still growing and has a low penetration rate. In addition, Flipkart India, in which Walmart has a 75% stake, is planning an IPO in 2022-2023, which could lead to a revaluation of the company’s stock.

Regardless of market conditions, the share price will be supported by dividends, which the company has been paying out steadily since 1989. The current yield is 1.86%, with a payout ratio of 27.23%. According to a Wall Street consensus, the fair market value of Walmart shares is £129 ($157), which provides investors with a 31% upside potential.

Crypto market on a phone screen
ArticlesMarkets

How to Best Diversify Your Investments

Crypto market on a phone screen

Keeping all your eggs in one basket is never a good idea, and this is something that certainly holds true in the world of investments. You need to make sure that you are diversifying your portfolio as best as you can, to ensure that your investments can be well-protected should something happen. The more diverse a portfolio you have, the more stable it will hopefully be.

 

Lots of Assets

The easiest way to diversify your investments is to spread your wealth and try several different areas of investment. It is easy to get trapped in one area, such as stocks, when there are in fact so many different types of trading for you to do. Looking into what cryptocurrency trading or forex has to offer can really give you some perspective on just what is waiting for you out there in the world of investments.

You could look into a more traditional area such as real estate and bonds. Though there is a flurry of interest around some of the newer areas of the market, as things like crypto really are something of a novelty, looking to the more traditional investment opportunities can yield some good results. Even if you start with nothing more than your 401k, look to some of the options out there that can help you to acquire more assets and spread your wealth a little more.

You could even look at acquiring traditional tradeable assets like oil or soybeans! These are often traded by larger corporations who use them as ways to hold and move their own wealth. Though you might not be trading on quite the same level, there is no reason why you cannot choose to purchase some of these to then use as part of a diversified portfolio.

 

Research

As soon as you commit to any type of trading, you need to make sure that you are properly educated on the subject so you don’t make poor choices. The goal here will be to make money in some way, preferably over a long period of time if it is for the purposes of a retirement fund. Put the time in to research and find the deals that you think are best for you to make.

This is especially important as there can be a lot of jumping on the bandwagon in some trading circles. Something might prove to be incredibly popular and attractive and will cause lots of investors to flock to it. This can devalue it, as everyone is interested, or it could even be a scam that pulls the rug out from everyone and leaves them with nothing.

Research and education are also vital in helping you to stop spreading your wealth too far. You want a portfolio that you know you can easily maintain. If you invest in everything interesting that comes your way, you could quickly find yourself with a bloated portfolio with too many assets to feasibly control. Keep things neat and manageable with maybe 30 or so investments. This should give you plenty to play with without making you feel overwhelmed.

 

Keep an Eye on Your Commissions

A big part of diversifying your investments will always be finding the right exchanges and platforms to do so from. Nowadays, there are so many aspects and factors to look out for, with every platform offering something a little different. You need to make sure that you find one to work with that will offer you the level of support that you need. Some platforms can auto-invest or at least find you the best options. Others can be a lot more hands off, and can be nothing more than the platform through which you make these investments.

However, you have to make sure that you pay close attention to any fees or commissions that you have to pay in order to use the platform. Some might be monthly fees, others could be per transaction. Both have their positives and drawbacks, so you need to make sure that you choose the style that suits you best.

What you need to watch for is how much you are spending on these fees. For example, fees per transaction can quickly add up – especially if you are an active investor and trader. This could seriously cut into any profits you might make, and you will still have to pay some commission even if you don’t make anything! Ensuring that you have the right platform will be incredibly important, no matter what.

 

If you are going to create a portfolio of investments, you need to make sure that it is as diverse as possible, so you can be certain that your money is properly protected. After all, there are so many ways in which your investments could be upset. The more diverse a portfolio, the more stable it will be overall. Take the time to investigate some of the other types of investment that you could make. There are so many sectors that you could look into. One could capture your attention that you have never thought of too, and so you could discover something entirely new. Take a look at what the world of investments can offer you now!

Investor plan
ArticlesMarkets

Rising Importance of Retail Investors

Investor plan

By Gediminas Rickevičius, VP of Global Partnerships at Oxylabs.io

Retail investors play an interesting role in the markets at large. For one, most academic researchers and hedge fund managers significantly downplay the importance of their everyday counterparts due to underperformance.

On the other hand, there has been a surge in the amount of retail investors since 2020. Investing has been made much more accessible and available to everyday folk. Combined with the global pandemic, these factors led to retail investors’ share of total equities trading volume now being close to 25%. Finally, there seems to be a push towards opening up private markets to more participants, as evidenced by EY research.

If such a trend continues, a massive influx of retail investors might increase the influence of their actions on the market. It might seem like a headache to seasoned veterans, but in many cases it might be a boon.

 

Retail investors provide cushion

As is often the case with many things in life, retail investors are seen through somewhat of a mythical lens. If one were to ask what event would define them, that answer would probably be the GameStop debacle.

It was certainly a visible and emotionally charged event that seemed to have everything you’d expect from a retail investor. Most people sought huge speculative gains through short-term trading without having access to tools that would enable such high frequency endeavors.

Additionally, some invested obscene amounts of capital, “leveraging” what they could. Often those were personal or spending loans. Some liquidated other investments to gain additional funds for the speculative play.

In the end, the event had all the hallmarks of everyone’s preconceived notions of retail investors. They were highly speculative, emotional, and chased significant gains. So, it would seem that would transfer over to other areas of investing.

Yet, some research would state otherwise, making retail investors highly useful to the market. As mentioned previously, they have begun to play a more significant role due to the increasing availability of investing.

A recent study has indicated that retail investors might be providing stability in times of market swings and crashes. COVID’s exogenous shock to the markets caused prices to tumble, but it was offset, by some margin, through the funds of retail investors.

Additionally, stabilization happens through providing additional liquidity to certain stocks. Finally, while they may seem contrarian as they pick stocks of which institutional investors think less, even if the contrarianism were true, it would still provide liquidity to stocks, which have less of it. In the end, retail investors play an important role in markets, especially during times of turmoil.

 

Retail investors talk (a lot)

Convincing someone to give up their investment strategy with all the data and potential software might be a little difficult. It’s a business that entirely revolves around knowledge intended to beat everyone else. Data and strategy sit at the core of investing.

As a result, outside of pure academical theory, any investment strategy is a closely guarded secret for institutional investors. Retail investors, on the other hand, are not quite the same. Many of them participate in various internet forums as a way of talking about strategy.

You can often find anything, ranging from simple investment advice (usually, ironically preceded by the saying “not financial advice”) to long posts discussing why some companies might be undervalued or overvalued.

Additionally, they are often posted in public forums where, while anonymous, posts are rated according to popularity. It would hold to reason then that such posts would have more sway over other retail investors. As a result, tracking large masses of small investments becomes an easier task.

Collecting such data, however, can be quite challenging. For one, there are places where retail investors congregate, but even then, there are a ton of posts going through them every day, making manual collection inefficient.

Couple that with the fact that sentiments expressed and overall influence can differ, and collecting such data for investment purposes nears to zero ROI or below. Fortunately, automated data collection methods have been developed.

Web scraping can be utilized whenever public data from the internet needs to be gathered at a large enough scale. There are plenty of solution providers online that can build complete out-of-the-box solutions that would make the collection of such semantic data easy.

 

Calculating talk

An important caveat is that even with automated public data collection, everything gathered would be semantic. There would be sentences and paragraphs expressing some sort of sentiment, which might not be immediately obvious, and have an effect that is also shrouded in mystery.

One way to calculate influence is to look for raw ticker mention volume. Quiver Quantitative has done exactly that for a certain piece of Reddit. There’s value to be found, however, pure volume likely only weakly correlates with investments.

It is entirely possible that a majority of such mentions are hidden deep in posts and comments no one ever sees. Only the crawler bot captures them, because it goes through absolutely everything. As a result, it can produce signals that miss the mark.

As scraping can collect any aspect of the data stored within the page, extracting popularity indicators and adding them to the ticker calculations would produce more accurate estimations of how impactful the mention would be.

Finally, sentiment is an important piece of the puzzle. Luckily, we don’t have to build customized machine learning models to extract sentiment. Google’s Natural Language AI and many other tools have already been developed that can serve our purposes just fine.

Combining these three factors with the general talkativeness of the retail investor can give us fairly accurate insight into the inner movements of capital from them. Whether these can serve as a separate investment strategy or enhance current ones, it is something for those who track such data to decide.

ArticlesMarkets

As 2022 Opens, Investors Flock to Defensive Dividend Stocks

We are only just about the fourth month into 2022 and we have a war breaking out, coronavirus continuing to plague the earth, and shaky markets – it’s not looking great, both as a species and as an investor.

Still, the markets are perhaps yet to top some of the craziness of 2020-21, with the rise of meme stocks, NFTs, and social trading. The pandemic was actually an accelerator of tech stocks, which is understandable, because it pushed us towards working and entertaining ourselves online.

So, if we accept the pandemic appears to be winding down, that may take some of the legs away from tech stocks. But more than that, the incredibly high inflation rate is causing a bit of panic – panic which seems to be causing a sell-off of high-risk assets, of which tech stocks are very much the center of that.

Liquidity in times of crisis

As a result of the current invasion of Ukraine, along with the selling off of high-risk assets, commodity prices are soaring. It’s understandable to see how some commodities, which are being directly sanctioned or indirectly threatened are rising, but commodities more generally are conducive to the idea of a defensive repositioning.

Furthermore, commodities like gold are a little closer to being a currency, and liquidity is exactly what we want in a time of potential crisis – not least if you’re a Russian citizen right now.

Another way to stay solvent during a potential economic crisis is to ensure some income. Cash is king, at the end of the day, and you can’t pay your rent in securities. In fact, selling off stocks or funds during a time of crisis is precisely what loses people money, because they’re selling their portfolio during a temporarily bad price.

Besides the obvious advice to have a healthy emergency fund for a cash buffer, we can also adapt our portfolio to generate income. Things like real estate are a little costly, inflexible, and potentially illiquid, so dividend stocks seem like a natural choice.

There’s a solid argument to make that, the income you receive from dividend stocks is merely factored into their price anyway (i.e. they have slower growth, generally) – so you’re not getting anything for “free” per se. But, that’s not the argument in favor of them anyway, it’s that we need income during those moments of a market downturn.

Plus, dividend stocks are often popular among value investors because they’re less risky and therefore less likely to be overpriced. Value investing, intuitively, feels like a winner during a selling-off period of high-risk assets.

How to choose the right dividend stocks

Firstly, before deciding on the right stock, it’s important to know the limitations of dividend stocks as mentioned before. During vast periods of growth, dividends + the equity won’t necessarily outperform other stocks that don’t pay dividends – it somewhat works out to be equal. The advantage of non-dividend stocks is that you simply get more choice over when to sell and liquidate, as opposed to fixed dividend payments. However, during times of crisis, receiving income without selling off our underpriced stock is ideal.

This is important to clarify because an important factor in your choice of stock is the likelihood that it will pay out during a market downturn. One way to gauge this is simply to look at how many years it’s been without the dividend payout falling – some boast many years, which gives an investor a lot of confidence. This will increase your chances of being paid during a recession.

Of course, how much you’re being paid is important, and how much this dividend grows by. Dividend yields differ between industries, but considering the FTSE 100 has an aggregate dividend yield of 4.2%, anything above this is pretty good. As for the dividend yield, this is a percentage of the annualized dividend relative to the stock price. Whilst a high yield may be great, be careful because it may also be because of a recent fall in the stock price – perhaps triggered by an anticipated fall in dividends.

What exact stocks you choose will depend on your portfolio strategy too – but here’s the dividend kings list for some inspiration. For example, if it’s a dividend-focused portfolio, your choices may differ from a portfolio that’s just looking for some dividend diversification. In the latter, you’re going to be more focused on firms that are recession-proof with a solid dividend history and great value, whilst if you’re filling the whole portfolio up with them, you want a wide range from different industries and countries – including developing ones, perhaps.

The dividend payout ratio will reflect the dividend as a percentage of the company’s earnings. Don’t be fooled into thinking higher is better because it’s more generous – lower payout ratios generally reflect that they’re going to be more sustainable. If you’re using dividend stocks as a hedging/diversification tool, then lower payout ratios are more crucial here too.

As touched on with being cautious around ratios and yields, it’s clear that they do not tell the whole story. It’s therefore vital to perform some further research beyond purely a quantitative analysis of these metrics. Value investing techniques accompany dividend investing very well, but also perform some qualitative research on the market, economy, and customer sentiment.

This is because you never know when a war or pandemic will break out. On paper 10 days ago, many Russian companies may have been persuasive on their financials – but fast forward a week and their entire stock market is closed. Whilst we can be fooled into thinking the US market is perfectly safe, because it’s the strongest, geopolitics, natural disasters, and other events cannot be predicted.

Therefore, whilst the USD is looking to remain strong and US stocks have historically great growth, geographical diversification is still important. Canada, the UK, Australia, and many other countries are offering fantastic dividend yields too. If we’re looking to mitigate the dangers of a US-centered tech crash, or anything remotely similar, then Asia too could be a useful hedge.

Investing
ArticlesMarkets

4 Things to Consider When Investing This Year

Investing

Before you make any vital alterations to your investment portfolio, make sure you are considering your long-term financial goals, especially during a period of volatile market changes. 

Investing out of fear and sudden ups and downs can lead to strange changes to your financial future that could have been served better with patience and strategy.

 

Tenant Credit Reports 

Instantly issue tenant credit report checks instead of being stuck wasting time manually pulling credit data on potential tenants that you are going to be entrusting your rental property to live in.

Credit reporting services permit you to efficiently and quickly screen potential tenants with real-time credit data and top-notch support to avoid tenant defaults.

Ensure that your tenants meet your qualifying requirements and minimize your exposure to potential legal action by streamlining your tenant qualifying process.

You can orchestrate soft-pull credit reports from Equifax, match potential tenants’ credit data to your requirements, and invite them to make a formal application request. Criminal and eviction reports are easy to generate, with easy integration to your platform.

 

Fractional Short-Term Rental Investing  

Fractional ownership is a method that allows you to purchase a percentage of shares in a high-dollar asset such as a jet, yacht, or real estate. 

Just as the name implies, the asset is divided into several fractions to make the cost of entry more accessible and lessen the burden among several like-minded people. 

It wasn’t long until fractional ownership ventured over into the stock market. Some brokers offer fractional-share trading of high-priced stocks like Amazon and Tesla, making these pricier stocks more accessible. 

Typically you decide how much money you want to invest, and then they’ll tell you how much of the share you can own. This method can be very appealing to new investors who are looking to start small. 

Even if you have the necessary funds to purchase an entire share, it’s a great way to diversify your portfolio and try your hand at more than one. Some brokers allow you to buy fractional shares in $1 or $5 increments, but some are even as small as one cent. 

Fractional ownership in real estate offers a way to invest in property without having to take on the entire cost by yourself. 

In most cases, a special purpose vehicle is created. A group of people pool their resources to share ownership in a home or vacation property, eliminating the need for a large sum of cash or hefty loans. 

All of the investors are deeded as equitable title owners and share in both the perks of the amenities as well as the cost of upkeep. This makes it an affordable option for luxury resort vacation homes that might otherwise be out of reach. 

Fractional owners also share in the gains and losses that come along with property ownership. If the home’s value grows over five years, everyone’s share in the home grows as well. 

If the co-owners receive income from the property, everyone gets their proportioned share of the income brought in. Each co-owner is also responsible for their share of the property taxes, which may go up as the property’s value goes up. 

With fractional properties, the property is usually maintained by a third-party management company in which the buyers would split that cost proportionally as well.

 

Invest in vacation rentals like stocks

Earn a passive income from the highest-yielding asset class in real estate with vacation rentals. Get started with as little as $100.

What are some of the many benefits that are associated with fractional short-term real estate investing with a company like Here for vacation rentals? 

Get in on properties that are situated in stable, high cash-flowing vacation markets that put it in a position to garner long-term returns on investment.

You can get your hands on totally passive income investment opportunities that come with full-service property management that allows you to not be bogged down with time-consuming tasks in order to keep the properties earning for you. 

Fractional ownership makes it possible for you to actually own shares of the vacation rentals property that you decide to get involved with and yield the results with a much lower barrier to entry and investment cost than you would be looking at if you decided to be the sole owner of the house. 

You will receive economic rights in the underlying property that include potential net rental income, tax benefits, and appreciation that you are entitled to. 

You will be in partnership with the company Here with a vacation rental and receive fractional ownership, which means that Here has a direct ownership interest in each property, so all the responsibility doesn’t fall on your shoulders. 

This is a Limited Liability Company (LLC) investment situation, so each 

property is held in an LLC and protected with property insurance that prevents you from being stuck with personal legal liability.

 

Be Careful of Investing too Much in an Individual Stock 

Lessen the risks of investing by diversifying your investments. 

You’ll be financially vulnerable and open to significant investment risk if you pour too much money into your employer’s stock or any individual stock because if it does poorly, or even worse, the company tanks and goes bankrupt, that is all money you will lose right along with. 

 

Investing with the Robinhood App 

Using the digital investment app called Robinhood allows you to have access to thousands of fractional shares.

Robinhood is appealing for newer investors who may not have a whole lot of liquid cash to put into the stock market for stocks, options, crypto, and ETFs.

There are no trading or commission fees, account minimums, or account maintenance fees.

Robinhood allows you to invest in thousands of stocks with as little as $1 for any amount that you want; you will get your dollars converted to portions of company shares and funds to help reduce risk and build a balanced portfolio. 

You get to enjoy stock trading in real-time, with trades that are implemented during market hours getting executed at that time to allow you to be aware of the actual share price. 

Precious Metals
ArticlesMarkets

The Benefits of Investing in Precious Metals

Precious Metals

Precious metals have been considered a valuable commodity for centuries. At one time, gold and silver was the primary form of currency. Unlike other currencies, these metals have retained their value over time, which is why many investors still use them today.

Here are some of the overarching benefits to keep in mind if you’re considering a precious metal investment strategy.

 

Self-Directed IRA Options

One of the main aspects of precious metal investments that investors enjoy is the ability to open a self-directed IRA. This familiarity makes investing in precious metals more comfortable, approachable, and manageable. As an investor, you maintain control of your assets, determining if and when to sell or buy. 

If you already have an IRA or 401(k), you can even use the assets to perform a rollover into a gold IRA (the umbrella term for precious metal investments). Take some time to research the best gold IRA companies and discuss your options with a financial advisor to find the best path forward.

 

Low Market Volatility and Risk

The aspect of investing in precious metals that makes it so appealing to many investors is the low risk and minimal market volatility. While it’s impossible to rule out the potential for market volatility, most precious metals— gold, in particular— are recession-proof and operate separately from stocks and bonds. 

Many investors use precious metals as their safe haven account— a failsafe to protect some of their assets should periods of economic distress occur. The value of gold and silver continued to rise through the great recession and the pandemic, while other investments toppled. Precious metals are considered more stable and predictable than real estate and other alternative investments.

 

Ideal for Diversification

The continuous increase in value, low risk, and market stability make precious metals an ideal alternative investment for portfolio diversification. 

It’s worth noting that precious metal investments aren’t without flaws. They have extra costs associated with brokerage and storage and lack the same tax advantages and short-term payoffs as other investments. I.e., you won’t see the return on your investment until you sell. 

However, these features are why it’s considered an alternative investment for diversification rather than a primary investment strategy. Talk to a financial advisor to determine whether this alternative investment is the right form of diversification for your investment goals.

 

Tangible Products

There’s something powerful about having a physical commodity to represent your wealth. In our digital world, currency is largely intangible; you won’t find stacks of cash sitting in a vault to access when you need it.

As precious metals are tangible, they also offer simple liquidity. When you decide it’s time to sell, you work with your broker and custodian to make it happen; there’s minimal red tape and fanfare. This feature also contributes to its value as a safe haven investment.

 

Various Formats

In addition to several types of precious metals in which to invest, there are also various formats. When you purchase precious metals, you can choose from coins, bars, and rounds. Keep in mind that you can’t purchase precious metals yourself then transfer them into an IRA; you require a broker to manage the purchase of approved products.

Investing in precious metals isn’t for everyone, but it’s a diversification strategy worth considering. If you’re evaluating alternative investments, consider these benefits of precious metals. 

E-Health
ArticlesMarketsStock Markets

Here’s Why You Should Invest In eHealth Stocks

E-Health

As the eHealth market continues to soar, Maxim Manturov, Head of Investment Advice at Freedom Finance Europe, sheds light on this trend and three of the top undervalued eHealth stocks to watch.

The global eHealth market only continues to grow, driven by rising awareness throughout the pandemic of the benefits offered by digital solutions. From remote monitoring tools to telemedicine, eHealth has come into sharp focus for healthcare professionals across the globe.

In turn, retail investors looking to maximize their portfolios are jumping on this trend. As an increasing number of investors look towards eHealth as a means to both combat critical health issues and generate high returns, organisations are seeing demand for digital applications soar. 

In light of this, let’s explore the growing popularity of the eHealth market and the trends associated with this growth. More importantly, let’s take a look at how investors can pick eHealth stocks that are right for them, as well as three undervalued eHealth stocks to watch.

 

The continued growth of the eHealth market

Analysts are expecting eHealth to grow at a compound annual growth rate of 16.1% during the forecast period of 2022 to 2027, with the expectation of the eHealth segment generating revenue of £46.7 billion in 2022 alone. China is expected to be the largest eHealth market in 2022 with £13.8 billion in revenue, followed by the US with £7.7 billion in revenue.

The major growth drivers of eHealth include the development of technology and the Internet of Things (IoT), as well as increasing demand for health management. In recent years, the number of Internet applications in healthcare have increased exponentially. Using the Internet, healthcare professionals can deliver medical information to consumers more efficiently. 

In particular, technological advancements in electronic health records (EHR) are driving the adoption of eHealth solutions, thereby contributing to the growth of the overall market.

 

The impact of the pandemic on eHealth

The growth of the eHealth industry accelerated during the pandemic as various technologies were used for remote monitoring and health management, including technologies like artificial intelligence (AI) and big data. The pandemic also forced various governments to quickly shift patient care and records to eHealth, due to long lockdowns and the fear of further spreading of the virus. In turn, this led to a significant market growth. 

This trend is expected to continue as awareness about the benefits of eHealth become more apparent. Even as the pandemic fizzles, digital health is expected to maintain its strength as healthcare providers and patients take advantage of new technologies and innovations.

Telemedicine remains one of the most important drivers of eHealth as it has increased access to healthcare, reduced person-to-person contact, and ensured continuity of care, as well as providing care for non-Covid emergencies.

 

How to pick the right eHealth stock for you

Investors can find the best eHealth stocks by following the standard parameters for selecting high-growth investments. Looking at revenue growth trends is a suitable place to start. It is typically a pretty good indicator that the company is doing something right. Even small, regular improvements over a long period can be a positive indicator. Both earnings growth and value must go hand in hand for the stock to be worth investing in.

You should also look at a company’s financial statements, which are often available on its investor relations website, both quarterly and annually. This will enable you to see whether revenue and / or profits are growing or declining. Companies that show positive profit growth tend to have financial and operational stability.

Ultimately, a stable eHealth company will possess certain characteristics: revenue growth, keeping debt at a low or medium level, competitiveness in its industry, and effective leadership.

 

Three stocks that are undervalued in the eHealth sector

1. Teladoc Health (TDOC) is arguably one of the brightest representatives of eHealth providers and received a solid boost from the pandemic. The company specializes in telemedicine services – providing medical care remotely over the Internet or phone, which was heavily needed during the pandemic. 

The global telemedicine market is expected to grow at an average rate of 32.1%, reaching an expected £486.9 billion in 2028. With the industry’s steady growth, Teladoc Health seems poised to reap the benefits. 

The bullish long-term outlook for Teladoc Health is supported by the fact that it is already a dominant player in the industry. As of January 2022, the company has a customer base of 76.5 million paying members in more than 12,000 companies. Despite Covid’s diminishing impact on the healthcare industry in 2021, Teladoc was able to increase its number of paid memberships by 50% year-on-year.

This is a clear sign of acceptance of the company’s virtual healthcare services. Teladoc Health is also growing through several strategic mergers and acquisitions. These deals boost earnings by helping to maintain engagement and expand the organisation’s geographical presence. 

Between 2021 and 2025, Teladoc is targeting annual revenue growth of 25% to 30%. This will likely be supported by an increase in paid visits from members, combined with growth in average revenue per member. 

2. American Well Corporation (AMWL) operates as a telemedicine company that provides digital health care. Its application offers emergency care, pediatric care, therapy, population health management, telepsychiatry, pregnancy and postnatal care, and breastfeeding support. 

The company also provides telemedicine equipment, peripherals, TV sets, tablets, and kiosks. There is upside potential to the average target price of £5.97 (about 120% upside).

 

3. 1Life Healthcare, Inc. (ONEM) operates a membership-based primary care platform under the One Medical brand. The company has developed a digital health membership model based on direct consumer enrollment, as well as employer sponsorship. 

Its membership model includes seamless access to digital health services combined with an invitation to in-office health care, which is typically covered by health insurance plans. The company also offers administrative and management services under contracts with physician-owned professional corporations or One Medical Entities. There is upside potential to the average target price of £18.37 (about 172% upside).

Cryptocurrency
ArticlesMarketsStock Markets

Three Promising Crypto ETFs to Watch

Cryptocurrency

With investors persistently looking for new ways to diversify their market portfolio, Maxim Manturov, Head of Investment Advice at Freedom Finance Europe, outlines three promising crypto ETFs to consider over the next few months. 

Cryptocurrency continues to catch the eye of many investors, with the demand for digital currencies growing significantly year on year. Offering greater choice, independence, and opportunity in their finances, cryptocurrency is a great investment for those willing to accept that this type of trading often comes with risk. 

As part of this trend, crypto exchange-traded funds (ETFs) are soaring in popularity amongst investors, by making it as easy to invest in Bitcoin as it is to buy popular stocks. On top of this, rather than attempting to pick a high-earning crypto yourself, an ETF offers exposure to a basket of different cryptos and provides easier access to the world of cryptocurrency.

In light of this, let’s take a look at the benefits of investing in crypto ETFs and three of the most promising crypto ETFs to watch over the coming months.

 

What is a crypto ETF?

An ETF is a pool of shares or assets that are grouped together, then sold on a stock exchange. This effectively allows for a variety of shares or assets to be owned through the ownership of just one share in the ETF.

A crypto ETF is very similar to your standard ETF. However, rather than tracking an index or basket of assets, a crypto ETF tracks the price of one or more digital tokens. This enables you to leverage the price of Bitcoin without having to learn the intricacies of how Bitcoin works.

Many investors are interested in crypto ETFs due to the benefits they bring at relatively low effort. Whether that be flexibility with trading, diversifying your portfolio, or lower cost of ownership, ETFs are a simple and easy way of gaining exposure to Bitcoin. 

 

The top three crypto-ETFs with the highest growth potential

1. The Siren Nasdaq NexGen Economy ETF (BLCN) is one of the first ETFs to focus on blockchain technology. With assets under management (AUM) at £142.5m, the fund tracks an index of global companies committed to blockchain development. Although the index committee is not active, it has broad authority in selecting companies. 

The main criterion used to evaluate a company is the level of material resources it has committed to researching, developing, supporting, and expanding the use of blockchain technology. It appears that distributed ledger technology, the blockchain, will play a central role in the economic transactions of the future. 

Given the recent weakness amid a general market correction, BLCN shares could be an interesting buy after breaking resistance of £27.3, in which case a move towards £34.95 is likely, making the growth potential 28.0%.​

2. ​​​Amplify Transformational Data Sharing ETF (BLOK) is an actively managed portfolio, mainly composed of global blockchain-focused stocks. With assets under management (AUM) at £671.6m, BLOK seeks to invest in companies developing or using what it calls “transformational data sharing technologies”, primarily focusing on blockchain technology. 

Blockchain, the technology that drives Bitcoins, is a distributed peer-to-peer ledger that facilitates transaction recording and asset tracking in the business environment. The growing blockchain ecosystem is a rapidly changing environment that includes many different industries because of the large number of applications. This relatively young market has great growth potential as the number of users increases and developers continue to create the so-called new Internet. 

Should it break resistance at £24.2, a growth of 34.4% is likely, changing the levels towards £32.52.

3. ProShares Bitcoin Strategy ETF (BITO) provides access to Bitcoin (BTC) dynamics in an ETF shell. The fund does not invest directly in Bitcoin but invests in Bitcoin futures, this is worth keeping in mind as there may be some lag in the price of Bitcoin. 

Bitcoin futures are traded in contango, which means that the next month’s price is higher than the previous months. Every time the fund sells futures contracts closer to expiration, it sells the cheaper contract to buy the more expensive one. This process affects the fund’s net asset value (NAV), which causes it to lag slightly behind spot Bitcoin. Nevertheless, this ETF is the most affordable way to have exposure to Bitcoin via stock market instruments. 

Overall, BTC dynamics have been good lately, on the back of rising demand, BITO stock could be interesting to buy after breaking resistance at £18.5, the growth potential of 36.3% is possible, making a new price of £25.22. 

Bear and Bull Market
ArticlesMarkets

How to Trade Bull and Bear Markets in Denmark

Bear and Bull Market

Many traders trade in Denmark, but it’s not always easy to make money in the markets. Read this article, and you will see why trading can be hard in a market that is in a bear trend.

But, there are also possibilities you can profit in a bull market.

There are several trading strategies to make money when the markets are trending, but if you want an easy way to get started with trading, one kind of strategy will help shorten your learning curve. You can also check out Saxo for more info.

 

So what is swing trading?

At its core, swing trading means opening positions for short periods. It could be anywhere from hours/days, or even weeks. The idea is to generate more income during a trending market and limit the risk when trading sideways or during a bearish market. This article will focus on swinging trade in bull and bear markets.

You should try taking trades that fit your daily schedule to swing trade. Depending on what works best for you, it could be after university, lunch break or even after work. You can not expect to make money if you plan your day around trading because there are only 24 hours in a day.

It would be challenging to stay focused if you tried swinging trades all day. But, when done right, it will be a simple, fun and easy way of increasing your income without working too much.

Swing Trading in Denmark, in the finance world, has two general types of markets. There is a Bull market and a Bear market. In a bear market, prices go down, and all investors lose money, but in a bull, market prices go up, and you can make money if you know how to trade it correctly.

 

A Bull Market

In a bull market, traders who have bought stock can profit from a price increase – this is because they will be able to sell the stock for more than they bought it for or sell it later at a profit even though they have already made their money back now that the price is higher.

So now what? You want to buy those stocks as well! A popular investing strategy called dollar-cost averaging lets you invest small amounts of money over some time to minimise risk.

So you could buy shares at regular intervals, but what is there left for you to do?

If prices go up, it’s apparent that it goes well for the stockholders and means that other traders who want to trade in this market might be put off because they think that the markets are not trending down.

It means that swing trading will be difficult because you won’t find any opportunities until the price has reached resistance or support levels where other traders will start retaking positions.

So basically, swing trading is difficult when prices move sideways; there isn’t much movement, so the chances are high that many people will sit on their hands until the next trend appears.

 

A Bear Market

When bearish trends are long-term, they can be difficult to trade because there are no clear entry points. The best way of trading in a bearish or down-trending market is investing in the trend.

If you wait for proof that prices go lower before buying any shares, then you could end up waiting forever! It means that if you buy too soon, your losses will be more significant when the price starts going up again.

 

Bottom line

Several strategies help you trade in a down-trending market without the high risk involved when trying to buy after prices have gone up. You can try short-selling instead of using your own money to buy stocks when bearish trends appear on your chart. Short selling involves borrowing stock from someone else, selling it and hoping to repurchase it later at a lower price.

Finance market
ArticlesFinanceMarkets

Financial Market in Athens Now on the Road to Recovery

Finance market

The business world has previously reeled from the economic impact brought on by Covid. The financial-market implications of the pandemic has no doubt been huge but despite this, key markets in the Eurozone are now slowly recovering.

 

Economists’ Forecast Trajectory of the Recovery

In recent weeks, Greek economists have begun putting out more positive forecasts on Athens’ economic growth, With the Omicron now fully managed, reopening efforts have began and global supply chains are now slowly getting back in order. In fact, passenger traffic just increased by 50% despite the 2021 May lockdown in Athens.

 

Business Travel Also Projected to Rise

With passenger traffic soaring at its highest peak yet, business travel is also projected to increase. Using luggage storage in Athens is a simple way to enjoy all your stops in the city without the hassle and stress of hauling your luggage around with you. There are just a few simple steps to store your luggage for the day:

  • Search online for the best location to drop off your luggage
  • Book your luggage with that location
  • Drop off all your luggage
  • Begin your ultimate day trip!

 

Greek Islands to be Revived

The government has planned a structural revamping for Greek Islands’ transport system as early as 2020 which came in time in the revival efforts of its travel market. The government, in partnership with Volkswagen, is aiming for a more sustainable way to travel within the island especially since it’s slowly reopening its doors.

With such plans, you can now set sail and take an all-day cruise to the islands of Poros, Hydra, and Aegina in the Saronic Gulf.  While breathing in the salty sea air and stunning views of the three islands, you get to immerse yourself in the beauty and history of these Saronic Islands. enjoy these activities throughout your day:

  • Entertainment on board such as Greek dancing and music
  • A buffet lunch
  • Plenty of time to leisurely stroll the islands and shop
  • Opportunities for guided tour of the Temple of Aphaia on Aegina Island

On this all-day excursion, these islands take you back in time when you walk down the marbled-cobbled streets and take in the historic stone buildings. With no wheeled vehicles allowed, you can easily imagine that hustle and bustle of carts, donkeys, and mules on the island of Hydra.

 

The Economy of Athens

Athens, being the capital of Greece, has a rich economy and the same can be said of it’s culture and history. It experienced sharp downturn in 2020 when it comes to economic growth although it has been forecasted that it’s set to experience a five-year trend of increased economic freedom.

With the economy on the road to recovery, visits to historical sites in Athens are also set increase.The top sites to see in Athens include:

  • Acropolis of Athens: located cliffside above the city, holds some of the most significant ancient buildings of Greek history such as the Parthenon, the Erechtheion, and the Temple of Athena Nike.
  • The Temple of Olympian Zeus was a former temple dedicated to the “Olympian” Zeus who was the head of the Olympic gods
  • Panathenaic Stadium hosted the first modern Olympics in 1896 is the only stadium in the world built entirely of marble.
  • Mount Lycabettus is a limestone hill located in central Athens. You can take a railway that climbs the hill to the highest point in the center of the capital city.
  • Odeon of Herodes Atticus is a stone theater on the southwest slope of the Acropolis of Athens. It was built by Herodes Atticus in memory of his wife, Aspasia. It was a venue for music concerts and now holds the Athens Festival each year from May to October.

 

Authentic Greek Businesses: Food, Trade & More

As a city rich in trading imports and exports, the city is no doubt alive with amazing food and goods selections. Mealtimes in Athens may look a little later than what you are used to. Lunch time is usually between 1:30 and 3:00, and dinner is usually between 9:00 and 10:00 p.m. Some of the most touristy places will serve food at earlier hours, however you may not see many locals in attendance. 

Also, breakfast is not the most important meal in Greece and many places do not offer it. If you’re looking for restaurants where gourmet food is more important than the price, here are some of the favorites in Athens:

  • Aleria Restaurant serves contemporary Mediterranean food using the best seasonal ingredients and area known specialties. Their wine list includes top artisanal wines from local producers and from around the world.
  • Kuzina is located on a rooftop terrace overlooking the city and giving Acropolis views. The menu changes throughout the year, only offering a few year-round dishes. Dinner is served from 5:00 p.m. to midnight.
  • Geros Tou Moria is a 90- year-old tavern that serves classic Greek dishes while you enjoy music and dancing each night. You can sit outdoors under the grapevines with views of Acropolis or sit inside closer to the music and dancing.

If you’re looking for authentic but medium-priced food, here are some of the top options:

  • The Old Tavern of Psarras opened in 1898 and is known for their fresh seafood, meat, and vegetarian options. This casual atmosphere offers live music, house wine, and outdoor seating.
  • Kostas is known for their gyros and souvlaki in the heart of the city. They offer pork or beef with fries, fresh veggies, and their signature tomato sauce. This is the best option for food on the go as the seating is limited.
  • O Thanasis has the best gyros, souvlaki, and kebabs, and is also located in the heart of the city. They offer more seating along the pedestrian street just off the Monastiraki Square. If you’re looking for a restaurant with flexible hours, they are open all day from 9:00am to 1:30 a.m.

 

Market Outlook for Athens

From its economy to financial landscape, you now have everything you need to plan if you’re planning to invest or take a trip to the capital city of Athens. Whatever you decide, you can do so much more if you store your luggage all day in one location as you conduct your business.

Retail Investment
ArticlesMarkets

Retail Investments: The Top 3 Stocks to Watch Amidst the Rise In Online Shopping

Retail Investment

With the online retail boom set to continue, Maxim Manturov, Head of Investment Research at Freedom Finance Europe, outlines three of the top investment opportunities to watch out for 

The appeal of well-known brands in the retail sector remains attractive to consumers and investors alike. Due to the Covid-19 pandemic, lockdowns were enforced at various times over the past two years, increasing the demand for online services which has acted as a catalyst for retailers’ financial performance.

In fact, online sales are expected to grow by 16.2% year over year, with an increasing number of retailers jumping on the eCommerce train to meet the ever-changing demands of consumers.

In light of this, Maxim Manturov highlights the top three retail stocks to watch that can deliver strong returns at an optimal level of risk.

The top 3 retail companies to consider

1. Crocs is an American company that designs and develops shoes and accessories for everyday wear. Crocs is currently looking to acquire rival Heydude with the aim of expanding its product portfolio and increasing its addressable market of customers. In turn, this will help to increase the organisation’s sustainable sales growth, cash flow and overall operating margins, which will contribute to a rapid reduction in debt. The acquisition is expected to take place in Q1 2022 and will expand the size of Croc’s addressable market to £92bn ($125bn).

It is also important to note that over the same period in the last two years, Crocs continues to report excellent financial results. In Q3 2021 alone, the company reported a revenue of £461.4m ($625.9m), which is an increase of 73% and 100% respectively. We recommend buying Crocs at £69.6 ($94.8) and hold until it reaches £140 ($190), which should take between 3-6 months and should see a growth potential of 100%.

2. Capri Holdings is a multinational fashion holding company. It develops and promotes clothing, footwear, accessories and perfumes for the world-renowned brands Michael Kors, Jimmy Choo and Versace.

In November, the company reported Q2 fiscal 2022 results that exceeded analysts’ expectations. Against this backdrop, the company’s management has increased its revenue and profit forecasts for the entirety of 2022. Revenue forecasts now stand at £3.9bn ($5.3bn), which is a significant increase from the previous forecast of £3.8bn ($5.15bn).

Capri Holdings is keeping up with the times and tries to participate in existing trends. For example, it has a presence in the NFT token market and creates luxury items for the metaverse. In so doing, the brand wants to be closer to the young, profitable generation.

Capri Holdings is also gradually reducing its debt burden. The company’s debt has now fallen to £840m ($1.14bn) and its cash position is £172m ($234m). The FCF level is stable at £123m ($167m) in Q4 2021. In other words, the company has no liquidity problems. We recommend buying Capri Holdings at £52 ($70.7) and selling at £58.9 ($80), which should take 6 months and see a growth potential of 13.2%.

3. Revolve Group is an online retailer and clothing manufacturer offering around 50,000 models of clothing, footwear, accessories and beauty products from 1,000 different manufacturers. One of the most alluring reasons to invest in Revolve is the company’s business model, which allows the sale of products only through its own online marketplace.  This helps save on-premises rental, property maintenance and third-party platform commissions.

The business also has dynamic inventory management that helps to estimate demand for products and increases inventory turnover rates. This leads to a significant increase in business margins and revenue growth.

On top of this, Revolve has successfully continued to improve its financial performance. The company’s Q3 2021 revenue rose 62% year-on-year and 58% year-on-year to £179.9m ($244.1m) in 2019, with the Revolve brand accounting for the bulk of the revenue at 83.7%. At the end of 2021, several investment houses raised their targets for Revolve shares, such as BMO Capital Markets, Morgan Stanley, and Raymond James.

We recommend buying at £44.5 ($60.6) and selling at £47.9 ($65), which should take 6 months and see a growth potential of 7.3%.

Alternative Investment
ArticlesFinanceStock Markets

6 Alternative Investments to Consider in 2022

Alternative Investment

The investment marketplace is broader now than ever before. Everyday investors aren’t limited to the traditional array of stocks, bonds, and mutual funds. Alternative investments once reserved for the very wealthy are finally accessible to smaller retail investors. And the landscape changes every day.

Which alternative investment strategies are most likely to pop in the coming year? In this article, Yieldstreet takes a look at six of the most promising investment possibilities outside the conventional marketplace. Some are proven sources that continue to pay off year after year. Others are burgeoning industries and practices that may emerge as mainstream investments themselves. 

 

1. Cryptocurrency

Cryptocurrency is arguably the highest-profile alternative investment of the last decade. In 2021, the mania only got louder. Early investors in cryptocurrency enjoyed some great returns last year. Digital currency exchange Coinbase went public in April, a sign of the growing legitimacy of crypto. Bitcoin and Dogecoin hit their highest market caps yet.

But is it too late to hop aboard the cryptocurrency train? We don’t think so. While cryptocurrency is still a volatile commodity, its growing acceptance in traditional marketplaces is a sign that it’s inching toward the mainstream. Still, there’s ample room for cryptocurrency to grow.

You can’t be blamed for hedging your crypto bets until the market relaxes. And you should still be judicious with your investments, especially in “flavor-of-the-week” coins. But if you’ve been on the fence about cryptocurrency, this might be the year to take the plunge. 

 

2. Peer-to-Peer Lending

P2P lending is growing as a viable alternative investment. The concept is simple: investors lend money directly to borrowers without a financial intermediary like a bank. Lenders set their interest rates in line with their risk assessment. It’s a choice for those who need money quickly or have spotty credit records.

There’s an elevated risk in P2P lending. The lender has to factor in the chance that the borrower will default on their payments. But the P2P lending marketplace is accelerating. Some analysts expect it to reach a value of nearly $560 billion in the next five years, with an annual growth rate nearing 30%. Discerning investors may want to take a closer look into P2P lending this year. 

 

3. Fine Art

Fine art is traditionally viewed only as a potential investment for the very wealthy. But that belief is changing. Thanks to the openness of the digital marketplace, retail and smaller investors now buy artwork as long-term investments in more significant numbers than ever.

The COVID-19 pandemic forced many traditional galleries to shift their marketplaces online. As a result, the art market unexpectedly grew by 15.1%, according to Motley Fool. Wealth managers embrace the trend and are increasingly recommending investing in fine art to their clients. 

 

4. Real Estate Investment Trusts

Private REITs let you invest in real estate that generates revenue without you having to do any of the grunt work—management, rent collection, upkeep, and so forth. After taking a hit at the beginning of the pandemic, REITs are starting to gain ground again.

Although the post-pandemic future is still a bit cloudy, investment experts expect an economic rebound. This includes some workers coming back to the physical workplaces after a couple of years of working from home, which bodes well for the prosperity of REITs, at least in terms of generating passive income. 

 

5. Cannabis

Cannabis continues to edge toward the mainstream. The recreational drug is rapidly shedding its stigma as many US states decriminalize marijuana use and possession. The cannabis marketplace is still volatile, as many stocks experienced a rollercoaster ride in 2021.

But the train has left the station. Cannabis industry data provider Headset expects the market to hit $45.8 billion in value by 2025. While the industry may spend the first half of 2022 shaking off last year’s unpredictability, cannabis investors may find the climate more palatable in the second half. 

 

6. Precious Metals

Gold, silver, platinum, and palladium are still considered to be safe bets in times of economic upheaval. In that sense, they’re not entirely “alternative” investments, but they still exist outside the mainstream marketplace. Especially as part of a self-directed IRA, precious metals still hold long-term value.

Investors who don’t like the relative illiquidity of precious metals can still take advantage of their value appreciation with exchange-traded funds (commonly known as ETFs). Gold, silver, and platinum ETFs are bought and sold on the exchange just like traditional stocks. They’re easy to buy into and just as easy to get out of.

Cryptocurrency
ArticlesMarkets

Dos and Don’ts with Cryptocurrency

Cryptocurrency


If you are looking to get started with cryptocurrency and either invest or buy and sell coins, you will want to understand the basics and what to look out for. Depending on what your needs are, you may be wanting to invest in a cryptocurrency and see how the price performs in the long term, or you may want to get straight into buying and using digital currency to purchase goods and services. Either way, here’s a short guide to some of the dos and don’ts with cryptocurrency to keep in mind.

 

Don’t put all your investment in one place

In the same way an investor will approach the stock market, you’ll want to diversify your portfolio and choose a range of different cryptocurrencies to buy. As the market can be volatile, you’ll want to have plenty of options to see growth. It’s a good idea to look beyond the well-known cryptocurrencies such as Bitcoin or Ethereum and diversify with altcoins. There are many thousands to choose from, each with its own different outlook, such as Floki that is combining the power of memes to be the people’s cryptocurrency, offering its own NFT metaverse and marketplace. This is part of the memecoin revolution that saw Dogecoin experience huge growth in a short space of time. Diversifying also ensures that if prices fall with some, you could still see success with others.

 

Do research and lean on insights

If you are not experienced with using cryptocurrency, you’ll want to be cautious before spending your real-world money. Keeping up to date with the latest cryptocurrency trends, news and insights can quickly provide an understanding of what’s happening presently, historically and what’s upcoming. It can be confusing, so it’s recommended to speak to experts or those who have been using cryptocurrency for a while. Consulting with those experienced with trading and spending digital currencies can be very helpful if you are a novice. You’ll also make sure that you make an informed choice with a cryptocurrency, as not all can be spent in the same way. If there is something in particular you want to purchase using cryptocurrency, you’ll want to make sure they accept your chosen coin. As it becomes more mainstream, businesses and retailers will be open to many more cryptocurrencies outside of Bitcoin, Ethereum and the most well-known choices.

 

Don’t fall for scams

As with any emerging or popular market, there can be those looking to take advantage and bad actors who will make false promises. Being able to spot the scams before parting with your money is crucial, with imposter sites that look like the real thing or new currencies that draw you in with guarantees of a high return. Being vigilant with anything to do with your personal finances is important, so ensure that you have researched fully before buying a chosen cryptocurrency and that you check the URL of the exchange you are using before proceeding. There are also phishing scams relating to must-buy digital currencies that can reach you via email or text.

 

Do own private keys

Once have a cryptocurrency balance, you’ll want to store them privately rather than on a public exchange. By having your own private keys, only you can access your coins and stay as secure as possible. A hardware wallet is a good way to achieve this as it is offline and away from any potential hackers or data breaches. Just like a USB memory stick, you can store your balance away from your computer or tablet and access it when you want. If taking this step, you’ll need to make sure you don’t forget your password and use encryption or 2FA to ensure it’s secure to you only.

Alternative Investment Markets
ArticlesMarkets

Finding Alternative Investment Opportunities In Markets

Alternative Investment Markets

For many, the global stock and bond market is complex, confusing, and challenging to navigate. Add to those challenges the uncertainty centered around the pandemic, job insecurity, and the general economic instability in the U.S. can make financial decisions much more anxiety-riddled. 

There are a variety of investment opportunities, each with its own risk, that you can consider. The investment boom is fueled by people’s desires to make and earn a passive income, add to retirement funds, and provide a level of financial stability that traditional jobs may lack. 

Finding hidden gems, alternative investments like NFTs, cryptocurrencies, and other opportunities to consider are excellent strategies to minimize your risk while having the potential for positive earnings. The point of the strategy is to consider a mix of short-term aggressive exposure (and potential gains) versus longer-term investment that takes time to mature and earn.

 

Types of Investment Vehicles Worth Considering

There are countless investment opportunities to consider, from Bonds to traditional stocks, cryptocurrency, and more. So how does the average investor make sense of all the options available? Investing isn’t easy and comes with some risk, but by taking a diversified approach, you should meet some of your goals while simultaneously lowering your exposure to risk. 

Below we offer three suggestions of what to invest in to maximize your potential. However, it’s important to keep in mind that this is a suggested strategy and not a guarantee to any particular outcome. You should always be sure to invest only with capital you can afford to lose, and always do your due diligence before making any major moves.

 

Cryptocurrency

Several factors have led to the crypto boom, ranging from the “boom” cycle of the investments, the rising popularity of the currency with celebrities and athletes alike, and the rise of social media as a primary form of information gathering. However, the primary benefit of crypto is the decentralized nature of the currencies. Being a decentralized currency means that its value is based on the demand of the currency rather than acting as a regulated form of legal tender. 

In turn, this gives rise to the vast “booms” we are seeing. Nonetheless, one possible downside to this type of investment is that it comes with volatility that turns many traditional investors off. The risk associated with volatility is that the value can see wide swings daily, leading to significant earnings and losses in a single swing. 



Traditional Stock Market

In traditional stock investing, you’re purchasing a share in a company that is anchored to the company’s value. As the value of the company increases, so too does the stock. As a result, there is some volatility in the stock price. Still, the swings in the value we see in cryptocurrency are not nearly as expected. There are regulations and safeguards to prevent the “boom-bust” daily cycle that crypto may experience. 

The advantage that the traditional stock market has over cryptocurrencies then is stability around minor fluctuations. However, a downside to conventional stocks is that it requires a much more significant investment to see sizable gains. Furthermore, it also takes much longer to see the value and return on the investment. 

 

Alternative Options: Penny Stocks with High Growth Potential

To diversify your investment strategy, you need to include a plan mixed with aggressive investments (such as cryptocurrencies) tied with more stable, long-term assets (such as traditional stocks). One way to make your investments more attractive and potentially secure higher profits in the shorter term is to consider looking at alternative options from the FANG and other blue-chip assets, such as penny stocks or out-of-the-mainstream investments. 

For example, the move from internal combustion engines, gas-powered, to more hybrid and electric vehicles will cause a demand for the various components and materials that make up the eclectic vehicles. Some demand for electric vehicles stems from popular decisions. In contrast, others are generated from governmental action and incentives, such as those recently passed and signed into law by the Infrastructure Bill of 2021.

The bill is expected to have a positive economic impact of over $15 billion for investments and development of EV charging stations, tax incentives, and more. For electric vehicles, that means critical infrastructure is being provided by federal, state, and local government and private industry has more than enough incentives to move away from gas and toward hybrid and fully electric vehicle production.

These developments mean plenty of opportunities for an intelligent investor to find a penny stock with a high ceiling. For example, electric vehicle batteries are made from nickel and other precious metals. As such, nickel mining companies stocks are a hidden gem with tremendous growth potential and should be included in any investment strategy. 

Of course, there is no guaranteed “safe” strategy to investing, but taking a slow approach with a long-term plan is the best suggestion for you to consider, especially as you start. This strategy doesn’t differ from ones suggested for Boomers to Generation Z, but the earlier you begin, the longer you have to accrue and recover from fluctuations in the market toward your investments. 

Stock Trading
ArticlesMarketsStock Markets

Six Essential Stock Trading Tips for Beginners

Stock Trading

To anybody new to the exciting world of stock trading, there are vital steps to consider before and during the process. These keys provide a solid foundation for your investment strategy and needs. Instilling a basic understanding is a key overlooked attribute to successful trading. Below resides the key basis for building a successful investment strategy. Implementing these fundamental basics is the structure that can make all the difference in the world of stock trade. 

 

Chart Your Purpose

The first and most important step of investing is to determine why you are investing in the first place. Are you looking to make a quick buck or gradually expand your portfolio through day trading? Conversely, are you in it for long-term investment? Establishing the foundational purpose for buying and selling your assets can be a cornerstone to your success in market trade and can also minimize losses.

Going into stock trading aimlessly, on the other hand, is a recipe for disaster. Investing without a purpose is often the precedent for large losses while having a plan often leads to investment gains. Instead, be sure to set yourself for success by trading — whether it’s buying, selling, or holding — with a purpose.

 

Chart Your Target

Charting your targets means determining the type of industry or the type of technology that you wish to invest in. Your investment targets should center around the type of product or business you believe has the best upside. If possible, aim your investment targets around a category that you’re familiar with.

 

Do Your Research

Research your targets by observing expert projections and opinions in addition to visiting company websites. Carefully perform your due diligence by familiarizing yourself with the company you are considering investing in. One overlooked highlight to observe when researching websites of potential investments is company standards and safety procedures. 

Company safety became a necessary study for investors after the BP oil spill caused a monumental sell-off. Any company that poses a safety risk can be volatile and can quickly find itself being shorted. In turn, any negative news regarding company safety issues causes a sell-off that can leave you holding the bag. Any company website that boasts OSHA 10 safety training or higher is a good indicator of high company safety standards.

Most importantly, however, be aware of upcoming products or press releases that may be of significance to the target company. Being up to date with the company you invest in is what helps you determine when to buy or sell. Never invest in a company you haven’t personally researched or have no knowledge of.

 

Never Buy At the Rise

Buying shares after a stock has risen considerably is the worst time to invest. Unfortunately, this is one of the biggest mistakes people make when they first begin investing. If you’ve seen a stock rise, accept that you already missed the boat — at least for this go around.

When you see a significant rise over a short period of time, do not take the bait. There’s always a fall, usually hard, after this initial rise. Wait for the gains to ride out until its inevitable and sudden decline This is called buying at the dip, and you’ll be extremely glad that you waited, rather than buying shares at their peak price and having a too-high cost basis.

 

Proper Diversification

Properly diversifying your investments helps you avoid the potential for large losses during unforeseen instances of market volatility. That’s why it is important to diversify with a purpose and not just for the sake of diversifying. Spread out your investments across different industry types, but also make sure you’ve done your research on those industries.

 

Never Panic Sell

When you see your stocks decline or plummet, unless justified by company-shattering news that initiated that sell-off, do not make the rash decision of selling off your shares. Remember that the market tends to fluctuate. Such as is the case in life, and there’s always a rise after a fall, just as there’s always a fall after a rise.

Ultimately, a loss is never a loss until you actually close out your position. But once you hit that sell button and get rid of your shares, there’s no turning back. Many people who panic sell end up losing much more than those who were patient and didn’t make impulsive decisions. Not being rash on the sell button can be the difference between monumental losses and monumental gains.

 

The Final Word

Utilizing the fundamentals provided above is an exceptional guide for any beginner getting their feet wet in stock trading. Use discretion while trusting your instincts when buying or selling. Bear in mind you haven’t truly lost or gained anything until you sell. Patience is as much a virtue in stocks as it is in life unless you’re day trading. Get a feel for market numbers and volatility, as this changes by the day — and even sometimes by the hour. 

Stock Trends
ArticlesCapital Markets (stocks and bonds)Markets

The Top Stocks to Watch Out For in 2022

Stock Trends

Maxim Manturov, Head of Investment Research at Freedom Finance Europe  

 

The global economy is gradually rebounding back to its pre-pandemic state, but with 2022 just around the corner now is the time to be researching and identifying the stocks that are most likely to perform well in the coming year. Since the start of 2021, the S&P 500 Index is up another 21.3%, but while most industries are showing signs of recovery, there are many businesses that have started to deliver promising double-digit growth.

Trying to navigate the investment path and settle on which of these high-growth companies will yield the greatest return can often be a difficult task. With this in mind Freedom Finance Europe have outlined three of the top stocks to watch out for in 2022.

 

Meta Platforms (FB)

Facebook currently remains the largest social media group in the world, with more than two billion active users a month interacting with each other via its many apps. Facebook announced its third quarter results on 25 October, and for this reporting period, revenue rose 35% year-on-year to $29 billion. In addition, net profit was $9.2 billion. Facebook’s digital advertising business still continues to grow steadily, which is partly to do with the soaring demand from small businesses, retailers and entertainment venues such as restaurants. In addition, the meta-universe – a market expected to reach $280 billion by 2025 – represents explosive growth potential over the long term. The average target price is at $405 (about 21% upside).

 

Visa (V)

The opening of the global economy will have undoubtedly been a boom for the credit card company Visa as consumers began increasing their spending on travel, holidays and restaurants. However, even though there are now more competitors within the field, Visa still has a significant market share. Visa’s shares are relatively lagging, but this creates an attractive entry opportunity. The company is also taking steps to stay ahead of the curve by acquiring a number of smaller financial technology companies to help expand its presence in digital payments. There is also talks of Visa even experimenting with cryptocurrency payments. The average target price is at $275 (about 30% upside).

 

Alibaba (BABA)

Alibaba has an excellent business and a large market capitalisation. However, the biggest risk comes from Chinese regulators. The company currently has a market capitalisation of $457bn which is down more than 50% from its peak in the fourth quarter of 2020. This being said that doesn’t seem entirely reasonable, as nothing has fundamentally deteriorated at Alibaba. The Chinese government’s actions are difficult to predict, so Chinese derived companies may bear more risk. However, now, at these prices, this risk can be factored into the price, which looks very attractive, and if regulatory hurdles disappear next year, perhaps Alibaba shares will come back to life and continue to rise. The average target price is at $240 (about 97% upside).

Blockchain Tech
ArticlesMarkets

Blockchain Technology Delivers ‘Scalable Efficient CBDC’

Blockchain Tech
  • Eesti Pank and Guardtime research project confirms role for digital bill money systems in CBDC deployment

  • KSI Cash per transaction energy use is just 70 µWh (micro-Watt hours) compared to 0.1 Wh for Visa and 1 MWh for Bitcoin

 

Blockchain technology can play a key role in the development of Central Bank Digital Currency  CBDC) platforms worldwide, a joint research project by Estonian Central Bank Eesti Pank and leading European deep tech company Guardtime has found.

The study set out to investigate the technological and operational frontiers of blockchain technology and its use in the context of CBDCs using KSI Cash, a digital currency technology based on the KSI Blockchain.

Testing confirmed that digital bill-based money systems are linearly scalable and highly efficient delivering end-to-end payment times of 0.6 seconds based on speeds of up to two million bill transactions per second.

Crucially it delivered a much smaller carbon footprint and lower energy use than current instant payments platforms – per transaction energy was just 70 µWh (micro-Watt -hour), compared with 0.1 Wh (Watt hour) for Visa and 1 MWh (Megawatt hour) for Bitcoin (1 Megawatt hour is one trillion micro-Watt hours).

The summary report written by Rainer Olt and Tiit Meidla of Eesti Pank and Luukas Ilves and Jamie Steiner of Guardtime says:

“The CBDC platform we deployed proved to perform well. The system was tested at speeds of up to two million bill transactions per second, where it operated with faster transaction times, lower energy use, and a smaller carbon footprint than current instant payment platforms.”

Central Banks worldwide are considering the introduction of both retail and wholesale CBDCs with countries including China with the e-Yuan and the Bahamas with the Sand Dollar launching or making retail versions widely available. The European Central Bank had decided to proceed with more intense investigations into a retail digital Euro while the Bank of International Settlements says 86% of Central Banks are conducting research or pilot schemes.

Eesti Pank and Guardtime’s research demonstrated its CBDC platform can integrate with existing e-ID schemes, making Know Your Customer checks easier and onboarding users into the system. Privacy preserving architectures can be made compatible with analytics needed for anti-money laundering monitoring.

Digital bills provide the privacy and programmability benefits of tokens but can also be held in account-like wallets, while the custodial layer used in the test enabled compatibility with conventional payment infrastructures.

KSI Cash’s security model delivers cryptographic verifiability of system operations without compromising privacy and the system proved to be resilient and resistant to insider and

outsider attacks. It also provides resistance to quantum attacks.

The project measured resource load during testing and an indirect assessment of the carbon

footprint of the system showed emissions of 32 tonnes of CO 2 per year, assuming a 14kW

power requirement.

Energy needs of one bill payment were estimated at 0.000000070 kWh (70 microwatt-hours) which is equivalent to 0.000016 g of CO 2 (16 micrograms). The table below shows the comparable figures for Visa and major cryptocurrencies.

 

Table: Comparison of per transaction energy use (given in Wh per transaction. 1 MWh = 1,000,000,000,000 µWh)

 

Bitcoin

Ethereum

Visa

Algorand

KSI Cash

1 MWh

170kWh

0.1Wh

36 mWh

7 μWh

 

Payment Trend
ArticlesMarkets

3 Payments Trends for Emerging Markets to Keep Eye On in 2022

Payment Trend

With 2022 just a few months away, the payments industry in Fast-Growing and Emerging markets is already showing the first signs of potential three key trends for the next year.
2021 has seen an immense ongoing acceleration and development of the payments industry, giving a strong overall boost to global e-commerce—it is predicted that e-commerce sales worldwide will reach $4.9 trillion by the end of this year. While popularity of payments trends like Buy Now, Pay Later (BNPL), projected to pass $100 billion in the U.S. alone, is expected to dominate the Western markets in the upcoming year, Fast-Growing and Emerging markets seem to be moving in a slightly different direction for 2022.
Frank Breuss, CEO of Nikulipe, a Fintech company creating and connecting Local Payment Methods to access Emerging and Fast-Growing Markets, identifies three major trends for Fast-Growing and Emerging markets that he sees taking off in 2022.

 

Importance of frictionless experiences

E-commerce and digital services continue to grow in Emerging markets, as well as globally, making frictionless experiences a key element for consumers. Breuss notes that long and oftentimes faulty checkout processes as well as lack of preferred payment methods have long been prevailing problems in these markets that are waiting to be solved.
“Consumers that were hesitant to shop online before have been pushed or prompted by the pandemic restrictions to switch their shopping habits—in most cases, shopping online for the first time. If the experience was positive they are most likely to continue with their new way of convenient shopping. This need for frictionless experiences will only increase in Emerging markets, since e-commerce there, while growing exponentially, is still figuring things out and trying to meet the consumer demands.”
Convenience and safety are likely to remain at the front of the mind for shoppers in upcoming year as well, and prioritizing this could bring increased conversion for a number of merchants.

 

Mobile payments at the forefront

With a sizable number of the population in Fast-Growing and Emerging markets still unbanked, mobile payments are most likely to continue leading the way, when it comes to preferred local payment methods (LPMs). According to Breuss, Africa could come as one of the primary regions where mobile-based payments take the key aspect for e-commerce.
“Africa has one of the youngest and second largest populations in the world—that is why there’s a broad potential for an even larger digital audience,” he explains. “In recent years, internet penetration has also been rising because of the vast expansion of mobile devices, especially smartphones, which led to mobile e-commerce domination of the online shopping scene in African countries specifically.”
The number of e-commerce users in the continent is estimated to reach over 334 million by 2021, and by 2025, it is predicted that there could be roughly 520 million users—supporting the idea that mobile payments could become a prevailing payments trend for 2022.

 

Subscription services could show even higher demand

The more home-focused consumer habits have led to an increasing popularity of subscription services, more notably video-on-demand (VOD) ones like Netflix. Breuss notes that VOD services, alongside music subscriptions, could gain even more traction in the upcoming year, since consumers in Fast-Growing and Emerging markets are putting higher demand on easily accessible and more global ways of entertainment.
“Consumers in Fast-Growing and Emerging markets have been excluded from many of popular subscription-based services due to geographical and payment restrictions for some time now. The lockdowns have only accelerated consumer demand for these services. The global subscription e-commerce market is expected to reach $478.2 billion in the next three years, and the majority of Emerging markets will be a part of it.”
In South Africa alone there are currently 7.2 million active subscriptions, from which 90% are subscriptions to digital content. The popularity of these services are only predicted to grow and by 2025 could reach 10.8 million. Eastern European numbers for subscription video-on-demand are also expected to rise—by 2026 the number should double to 40,000, compared to 20,000 in 2021.
The three key trends, which could be the ones most prominent in Fast-Growing and Emerging markets for upcoming year, all bring focus on convenience, efficiency, wider accessibility and inclusivity. Frictionless experiences, which also include growing accessibility of subscription services as well as preferred local payment methods like mobile payments, seems to be a driving force behind the Emerging markets’ payments landscape in 2022.
Stocks
ArticlesMarketsStock Markets

Five Explosive Stocks from the Past Year

Stocks


By Dáire Ferguson, CEO at AvaTrade

The traditional rhyme commemorating Bonfire Night begins, “Remember, remember the 5th of November”. This Bonfire night, we remember five explosive stocks from the past year.

 

Tesla

The electric vehicle manufacturer’s shares have exploded so far this year, more than doubling in the last six months alone. Tesla’s market capitalisation has whooshed past $1 trillion, making this figure nearly 1.5 times more than the combined market capitalisation of the next five largest automakers. 2021 has been a strong year for the company, with Tesla putting plans in place for its foray into India, one of the largest emerging car markets in the world, while demands for its cars are booming. For example, the Model 3 is the top-selling premium sedan in the world and it is currently the best-selling vehicle in Europe. Nevertheless, shares are significantly higher than fundamentals suggest they should be. While the company currently has momentum, the bubble could burst at any point – is a crash back down to earth at some point inevitable?

 

Macy’s Inc

The price of Macy’s, the major American department store chain, has skyrocketed this past year. Shares are up considerably over 100% since the start of the year, with the company managing its post-pandemic recovery expertly. Macy’s management team significantly reduced expenses on a permanent basis and increased the emphasis on its digital sales channel. With these moves, it’s apparent that management has acted decisively to ensure the business is in a strong position to ride out the current economic uncertainty, causing Macy’s long-term profit margins to soar like a firework. The burning question on the mind of many traders is whether the trend will continue or fizzle out.

 

Royal Dutch Shell

Royal Dutch Shell has sparkled. The stock plummeted after the initial outbreak of the Covid-19 pandemic, but the oil and gas giant has recovered over the course of the past year, reporting revenue figures of over $200 billion. What’s more, the recent oil and gas shortages around the world caused energy prices to skyrocket, which has also contributed to the increased share price of Royal Dutch Shell. But these shortages are not here to stay forever, so will this stock continue to rise?

 

American Express

American Express has seen its shares light up the sky with an increase of over 40% since the start of the calendar year. In terms of its quarterly performances, the credit card services company beat analysts’ forecasts by 70% and 68% respectively in the first and second quarters of 2021, and once again exceeded predictions in the third quarter. AmEx putting a greater focus on new and younger customers that may use their products for years to come has also contributed to its stock dazzling and whizzing into the top of the charts. Traders are asking themselves if this trend is sustainable.

 

Citrix Systems

For Cirtix Systems in 2021, its share price has fizzled, falling with a bang and a puff of smoke. There are a number of factors which have contributed to this fall. This includes the Software-as-a-Service (SaaS) provider’s CEO, David Henshall, surprisingly stepping down with immediate effect last month, as well as poor financial results for all three quarters so far this year, leading to a sharp decline in the company’s profits. Will the company be able to halt this drop off, or will this downward spiral continue?

Stock trends
ArticlesMarkets

The Safest Way to Invest: A Guide for Generation Z

Stock trends


By Hamzah Almasyabi, CEO at MintedTM, an investment platform which allows individuals to buy and sell precious metals.

The pandemic has caused financial concern for many, but particularly for the younger generation, who are now facing uncertain career prospects and the rising cost of living. With more than ever to consider financially, the need to save and invest for the future has become even more apparent. Taking financial security into their own hands, Generation Z have turned to modern technology to make smart investments.

Cryptocurrencies and app technologies are changing the way people manage their money, by offering a more accessible and modern route into investing. Research undertaken by precious metals savings app, Minted, found that 71% of 16–24-year-olds are investing their money, compared with only 35% of those over 55. When looking at the financial difficulties so many young people are currently facing, this statistic comes as no surprise. Up against a higher cost of housing and rising national insurance costs, Gen Z has been left with no option but to think tactically about their future, which has led many down the path and investment. The pandemic added to this need, prompting over 60% of 16–24-year-olds to start saving more and over half to start investing. With precious metals, stocks and shares, and cryptocurrencies amounting to almost 60% of total investments for this age group, it’s clear they are not afraid of exploring differing investment options.

Social media has also played a large part in the increasing number of young investors, with terms such as bitcoin and dogecoin regularly featuring on trending pages. Platforms such as Twitter, YouTube, and Reddit are useful sources of information for younger investors looking to get started and there are a number of ‘how to’ guides readily available.

Gone are the days when a physical bank is needed to support investing habits and a rise in fintech companies has seen a number of smarter investing and banking solutions hit the market, app investing being one of them. Offering users low entry costs and starting amounts, young people can delve straight into building their investment portfolio using just their smartphone.

On a mission to offer a safe and convenient route into investing, Minted is encouraging more young people to invest their money where it matters. Investing should be a viable option for the everyday person, whether they’re looking to boost their bank account, or building an investment portfolio of precious metals and cryptocurrencies.

However, as with any form of investment, a certain amount of knowledge is crucial. Proper research and education into investment routes is vital to mitigate against any potential risks. Users must be aware of the ever-changing financial landscape and that markets can be volatile, which was evident when the value of bitcoin dropped approximately 15% after Elon Musk tweeted that Tesla would no longer be accepting the currency as a form of payment back in June.

Each investment has different levels of risk. For example, cryptocurrencies, such as bitcoin can be considered particularly high risk, due to their volatility. Investments into more traditional stocks and shares, or precious metals, such as gold or silver, which hold their intrinsic value, could be considered the safer option. Ultimately no matter where the money is invested, proper research and understanding is still pivotal.  

Investors relying on modern technology, such as apps, should begin by undertaking thorough research into the platform of their choice. Users should ask themselves what they are looking for from their investments and what their long-term goals are. Is it to make money quickly, or invest slowly over time for a more gradual financial growth? Are they looking for a physical product, such as gold? Establishing these goals can help ensure that the investor is making smart financial decisions that will benefit them and which suit their situation.

Looking at the credibility of platforms is also crucial; users should research how established the company is and what has been written about them online. This will give users an idea of how reliable the platforms are and whether or not they are the right option for them. Being aware of any additional fees, details of the terms and conditions, and what exactly the app is offering, is essential in preventing any nasty shocks further down the line.

For young people taking their first steps in investment, starting slow and building up experience can be beneficial in the long-term. It is generally also good practice to spread risk by investing in different asset classes and industries. Setting up a range of smaller investments, rather than one large sum, ensures that users are better protected against substantial loss and able to build a wider investment portfolio. Being realistic around affordability is another key factor to consider, as this will prevent against any financial difficulty. Markets can change quickly, so not reacting rashly to a changing landscape is vital if a portfolio is to be managed effectively.

As investment apps and cryptocurrencies continue to rapidly diversify, no one can say for certain what is on the financial horizon. Whatever the future holds for investment, it is certain that the younger generations have a significant role to play in popularising new and developing platforms, as well as challenging the stereotypes of what people invest in, and more importantly, how.

Cryptocurrency
ArticlesMarkets

Crypto Lobbying Group Pushes for Stablecoin Regulations

Cryptocurrency


The Biden administration has been presenting proposals to regulate stablecoins. One of the largest lobbying groups in the industry is out with a list of recommendations.

Stablecoins are cryptocurrencies whose value is tied to fiat currencies such as the U.S. Dollar, precious metals or short-term securities. They are used to reduce the inherent volatility in digital coins. These coins are used by traders to enter and exit trades and are being increasingly used for traditional banking products such as savings accounts. However, there is little regulatory oversight and no FDIC backing.

In a new 17-page letter The Chamber of Digital Commerce, which is made up of top U.S. Treasury, Federal Reserve, and Securities and Exchange Commission officials, argues that stablecoins shouldn’t be regulated in the same way as money market funds or securities.

Instead, the asset class should be regulated as a payment system by standardizing the existing system of oversight using money transmission licensing laws applied at state level. According to the organization, Binance.US, Circle, and traditional financial players Citigroup, Mastercard are among its executive committee.

Perianne Boring is the founder and president of the Chamber. “This is a critical issue,” she stated. She added that if we receive policy recommendations that do not allow stablecoins as payment system instrument operators, “it will be pushed abroad.”

As President Joe Biden’s Working Group on Financial Markets (PWG), which includes the Treasury, Fed and other major U.S. regulators, has made recommendations to the crypto industry, it is expected that a report will soon be issued with recommendations for a regulatory framework regarding stablecoins.

This week Bloomberg reported The SEC will have significant authority to regulate stablecoins. Yahoo Finance was informed by an official who participated in the report that the SEC would not be given new authority to regulate stablecoins. Instead, the SEC will continue to exercise its existing powers.

The regulators have considered new rules for regulating stablecoins, similar to those that regulate money-market funds and new banking rules.

Since stablecoins are instantaneously settled using blockchain technology, the Chamber suggested that they be classified as digital payment systems rather than investments or securities.

According to the Supreme Court, an investment contract must have an expectation of profit in order to be considered a security. They argued that stablecoins were not intended to decrease in value and that they don’t have an expectation of profit.

Boring warned that if stablecoins were classified as securities, it would limit their use as retail payments.

Yet, Gary Gensler, the Chair of the SEC has used the analogy of stablecoins with poker chips in a casino. He told Yahoo Finance this week that crypto was like the Wild West and asked regulators for more authority to regulate them.

The Chamber suggests that the federal government offer the possibility of obtaining a national bank charter but not force it. Some virtual currency businesses have received preliminary conditional approval from the Office of the Comptroller of Currency.

Industry also opposes the regulation of stable coins as money markets funds. They argue that they don’t look like money market funds and are passive investments. Stablecoins aren’t designed to grow in value and can be used for digital payments.

Given the rapid growth in stablecoin markets, regulators are more aware of systemic risks. It currently stands at $130 billion, an increase of $37 billion from the beginning 2021. Some of the most popular stablecoins are Tether (USDT-USD), BinanceCoin (BNB-USD), and Paxos.

The industry is growing rapidly, but the global stablecoin marketplace at $132 billion represents a much smaller market than the asset value of U.S. money markets funds at more than $5 trillion.

The letter stated that regulators should tailor stablecoin regulations to reflect the risk profiles of different types of stablecoin payment systems.

It stated that federal regulators should consider additional safeguards when stablecoin payment systems are implemented at a significant scale across the country.

According to the Chamber, most stablecoin payment systems are comparable in size to corporate reward programs like Starbucks gift cards or airline miles.

Boring stated that “We are concerned about what we have heard and seen from the PWG thus far.” We believe the notion that stablecoins pose systemic risk is seriously misguided.”

Officials are concerned about stablecoin runs. The issuers have large amounts of short-term securities such as Treasuries and certificates of deposit. Investors could decide to withdraw their money suddenly if cryptocurrencies fall, which could lead to financial system disruptions or even losses.

Boring says, “There is nothing I can point out that would prove that [stablecoins] have any systemic value.”

The Digital Chamber of Commerce focuses on U.S.-based stablecoin issuers such as Circle and Tether. Boring points to the U.S. stablecoin issues like Circle’s reserves, which are almost entirely held in cash and not commercial paper like Tether.

The Chamber also claims that U.S.-based stablecoin issuers are not leveraged and pose no systemic risk. The Chamber doesn’t believe any U.S.-based stablecoin issuer has reached an important size that warrants additional oversight at the moment.

She stated that she didn’t believe there could be a run in such a scenario, provided the disclosures are accurate.

Cryptocurrencies
ArticlesCommoditiesMarkets

Cryptocurrency the Asset Class of the Future

Cryptocurrencies


By William Je, CEO Hamilton Investment Management Ltd

It is a safe statement to make that many financial institutions have in recent years, been torn as to whether cryptocurrencies are an asset class. Analysts are polarised. This is unsurprising as, over time, cryptocurrency went from being widely seen as a conduit for money laundering into a serious proposition for investors. And it’s not just the novices that’ve hopped on board with the cryptocurrency hype, even large, established companies, including the likes of PayPal, which have in turn dabbled with the digital currency as a genuine form of payment.

Major banks have also been rushing to set up crypto-related operations recently, with Morgan Stanley and Bank of America establishing a crypto-focused research division. State Street announced the launch of a dedicated digital finance division. JP Morgan and Goldman Sachs are also rolling out crypto trading services.

An asset is anything of value or a resource of value that can be converted into cash. Traditionally, an asset can often generate cashflows: stocks provide dividends, bonds provide coupons, loans provide interests. However, there are assets that do not really produce cashflows but still being considered as an important asset class.

Gold has long been considered to be an important asset class. It has very limited industrial usage and does not really generate cashflows. It is only collective thinking that gold is valuable that makes it so. In fact, this also applies to any fiat currency. After all, money is only a credit that a currency’s user gives to the issuer. For a currency to thrive, trust is the most important factor. The issuer of fiat currencies are sovereign entities which are deemed to be the most trustworthy. If there is a currency or economic crisis that the people do not trust the government, the value of the fiat currency will drop significantly. 

So, an asset’s value will depend on the collective believe and trust of the people dealing with it. It is still at an early stage to conclude that investors believe and trust in the value of cryptocurrency, but the trend is definitively positive.

Throughout the course of history, we have become accustomed to recognising ‘traditional’ asset classes. Many investors regard cash and equivalents, bonds, and stocks as conventional financial investing’s big three. However, ever since the rise to prominence of cryptocurrency – a decentralised means of digital currency – many have started to question, should cryptocurrency be regarded as an asset class? This debate is as important as ever, considering that legislators and policymakers ponder upon taxing crypto in line with other assets in the midst of a tax war we’re witnessing. Currently in the US Congress, rules on tax on constructive and wash sales are being debated. Presently, only traditional asset classes such as bonds are stocks are subject to these rules, but there has been controversy about whether commodities, and digital assets should be considered.

In recent times, society has done a tremendous job of selling us on the idea that replacing our hard-earned cash with virtual currency is a good idea, and for good reason too. It does not take too much research to see that SMEs, family run businesses, corporates, asset managers and more are all investing in the crypto market. There is, however, a hurdle of learning new terminologies and understanding a new process.

As a result, many people shy away from dealing with it. This can seem daunting and is certainly a barrier to entry for some. However, it isn’t a reason to ignore what could potentially be an immensely fruitful asset pot. Professionals must now start to change their perspective on cryptocurrency, particularly in relation to what institutional investors consider to be an asset class and adapt processes to enable us to deal with cryptocurrency more effectively. Gone are the days of solely dealing with traditional assets. We all know that there are an enormous number of crypto assets now available and certainly the pandemic appears to have played a key role in driving increasing demand from both retail and institutional investors.

It’s not a secret that Bitcoin is the most valued – and thereby attractive – cryptocurrency on the market. Experts have largely accredited this by way of its scarcity, drastically leveraging its general understanding as an asset class. Bitcoin in particular benefits from investor confidence because of its snowballing popularity. Just as people in society believe in the value of diamonds because others believe in it, cryptocurrency shares this artificial value.

This further accentuates the power of supply and demand to dictate price. As hype is artificially created as a societal construct, it causes people to blindly jump on the bandwagon. When combining this with our excessive need to want what we can’t have; the forbidden fruit principle, it’s only to be expected that the price of Bitcoin is so high.

Bitcoin was the first scarce digital asset ever created. Imagine that – a digital product with a fixed total supply of 21 million coins. For new coins to come into circulation its new supply is cut in half every four years through a “halving” mechanism, until all 21 million coins are mined. As a result, it is estimated that only 18 million coins have been mined to date. Of those some believe that 5 million are technically lost, 10 million stored in long-term cold storage, and close to 3 million on exchanges. Mankind has always based the value of a currency on this concept of scarcity – that is why precious metals have been the backbone of many economies for centuries.

The growth in the number of cryptocurrencies is changing all of this and the faith put in them by investors is driving confidence in them as an asset class. If investors continue to believe in the value of gold because others believe in it, it will remain an asset.  The difference with cryptocurrencies today, and gold of the past is therefore minimal.

But what is driving that faith, and what is underpinning the huge increases in the value of cryptocurrencies? Well maybe it has less to do with the currency itself and more to do with its ability to store value in relation to other asset classes. Widespread social adoption together with its privacy, security and transferability make cryptocurrencies an important asset class to store values. Maybe it’s time for a bit of a backward glance and look to recent history to explain this. Since 2008 and the unleashing of quantitative easing, there has been an undoubted period of price inflation. And yet if you look to the balance sheets of many central banks one thing stands out – global currencies have depreciated.

Cryptocurrencies don’t follow the same rules as fiat currencies, or even secured assets, instead things tend to get complicated.  Given a cryptocurrency does not generate or support cashflow, it needs to be valued against potential – and critically – future prices. That then opens the door to several different valuation methods and guess what – our old friend gold is back. Amongst the differing valuation models now available – the stock-to-flow method, institutional participation method, and high-net worth participation method – we find the gold valuation method. But let’s not forget this is a new asset class so we would expect investors will consider a range of valuation methodologies to estimate future value. This is, however, not risk free. It is a new asset class, and one that does not exist physically. It is not gold as we are repeatedly saying. Risks do exist and they are well known, and some would argue substantial. We are firm believers that the industry needs to face into – and support – government initiatives around regulation.

But this is not the only risk associated with cryptocurrencies. Swings in the wider macroeconomic environment, risk associated with the technology backbone – everything from electricity supply to bad faith actors, and even an ever-more vocal and powerful economic, social, and corporate governance framework – ESG as it is known. All of which add to the potential risk for crypto as an asset class in its own right.

El Salvador became the first country in the world to adopt bitcoin as its national currency, allowing people to use a digital wallet to pay for everyday goods. Many countries are considering to issue their own central bank digital currencies. All these have been telling of cryptocurrencies’ future potential in line with an asset class.

The key question remains; should institutional investors dive in and is it in fact a dedicated new asset class?

The primary reason why some don’t regard cryptocurrency as an asset class is because it’s unclear regulatory environment and high volatility. However, more and more institutional investors use cryptocurrencies to hedge against inflation and currency debasement, and to diversify their portfolios in the pursuit of higher risk-adjusted returns. Over time, institutional investors have been more inclined to consider cryptocurrency as new asset class

Bitcoin is the most famous, most written about and most volatile of the many cryptocurrencies now on the market. Given the number of methodologies available to value not only it, but all digital assets, if anything, institutional interest is only just beginning.

This is without doubt, a new asset class and one that will increasingly gain acceptance and participation of institutional investors as time goes on.

It may not be physical gold, but it could very well be digital gold.

NFT
ArticlesMarkets

What Do Payments Market Players Have to Gain by Acquiring NFTs?

NFT


A ploy to stay in the loop or a strategic decision? Simas Simanauskas, Head of Payments at ConnectPay, has explored further what’s in it for the payments processing giants diving into the NFT trend.

A growing number of businesses are joining in on the Non-Fungible Token (NFT) craze. Not long ago, Visa, the payments processing behemoth, bought a “CryptoPunk” – one of the thousands of NFT-based digital avatars, for nearly $150,000 in the cryptocurrency Ethereum. Following the example, Mastercard has recently entered the market as well by announcing a sweepstake to win an NFT. According to Simas Simanauskas, Head of Payments at ConnectPay, the NFT appeal can be attributed to both staying on-trend, liquidity, and its massive future potential.

The NFT market sales volume grew approximately 182 times in the first half of 2021, compared with the same period in 2020, reaching a whopping $2.5 billion. Seemingly everyone–from sports fan platforms to art houses jumped on the bandwagon. According to Simanauskas, while the actual value of NFTs is subject to much debate, it is widely seen as an appealing market for investment.

“VISA’s move to acquire one of the iconic “Cryptopunks” is nothing less than a message that traditional market players are closely following the crypto-space and looking for ways to capture part of that market,” he stated. “When and how they will do it will very much depend on the overall crypto regulation, as well as how fast the biggest crypto wallets and exchanges will adopt rigorous Know-Your-Customer (KYC) regimes.”

 

Others joining in on the trend

There is little evidence to suggest the NFT boom will dial down anytime soon, which seems to have attracted more payments market players to get on board. For instance, Goldman Sachs has been offering bitcoin futures trading for some time now, while Mastercard has partnered up with Circle to create a solution bridging cryptocurrencies and traditional fiat money for people wanting to spend their digital assets anywhere Mastercard is accepted.

“Since NFT is another use case of blockchain technology that has attracted massive liquidity, there can be no doubt traditional players will seek to stay relevant in the market and will look for ways to cater for NFT traders,” Simanauskas added.

 

Potential threats for the finance sector

However, where large sums trade hands – fraud is rampant. For instance, earlier this year, a hacker exploited security loopholes on a famous artist’s website and sold a fake Banksy NFT for $336,000. Hence, when it comes to potential threats to the finance sector, for instance, money laundering, Simanauskas notes authentication and systems will need to be made more robust.

“One could argue that a person seeking to launder funds would either buy or create multiple NFTs—which can take only minutes to create—list them on various platforms, buy them using illicit funds from multiple anonymous wallets and legitimize one’s funds as a proud digital artist. That’s not an issue of NFT, but rather one of KYC,” Simanauskas explained. “As long as crypto exchanges will do sloppy KYC and platforms will accept payments from anonymous wallets, the blockchain industry will retain its messy image.”

“On the other hand, many big players in the industry are trying to clear that reputation by bringing more transparency and internal regulation into the way they oversee client transactions. While financial watchdogs are trying to make sense of all this and prepare to regulate the crypto-space, it will largely depend on the blockchain community itself how well they can address AML/CTF and security questions that would make people trust and utilize the technology to the fullest.”

Stock Market
ArticlesCapital Markets (stocks and bonds)Markets

What to Look For in a Stock Market API

Stock Market

The financial market is one of the industries that has relied heavily on technological innovations for its operations. In the last few years, there have been new solutions developed to streamline the industry and make its operations seamless. One of the major driving forces for these solutions has been APIs (Applications Programming Interfaces). They have opened a channel through which companies come up with innovations to handle all their transactions and to meet the demands of the modern investor.

APIs are computing interfaces through which applications can communicate and share information with each other. This means that when building an application, developers do not have to work day and night getting the data needed for their application to meet its obligations. They can simply implement an API and obtain the data from other applications. This has made software development easier and faster. 

 

What are Stock Market APIs?

As discussed above, APIs allow applications to exchange data and communicate with each other. Similarly, stock market APIs provide stock applications with financial market data for their operations. Traders and investors use APIs for stock to obtain structured data from complex market data while developers use them when implementing the functionality of their applications.

A few years ago, before developers and traders started using APIs, they had no option but to collect and analyze the financial data on their own. This was raw data from different sources such as newswires, indices, and stock exchanges. Such data was difficult to analyze and compare and often led to many investment mistakes. APIs solved this problem and made things easier.

When choosing a stock market API, there are a number of things one should look for. They include;

 

Latency

Latency refers to the time a stock market API takes to send data from the source to the application that made the request for data. APIs with low latency are accurate with their data and sent it faster than those that have high latency. You should make sure that you choose a stock market API with low latency for the successful transmission of data.

 

The Scope and Source of Data

It is important to choose APIs for stock that offer a wide scope of financial data. For instance, you need an API that guarantees you data such as stock data, exchanges, forex, news, commodities, options, and economic data among others. You should test the API to make sure that all this data is available. In addition, you do not need an API that gets its data from a public source. Such data might not only be illegal but also unreliable.

 

Data Being Transmitted

There are free and premium stock market APIs, with each offering different types of data. Before getting one of them, you should analyze the style you use when trading and choose the one that fits you better. The free APIs will get data sometime after its publication, usually about thirty minutes later. On the other hand, premium APIs will get data in real-time. There are also other APIs (or both the free and premium APIs) that offer historical financial data. The right API depends on the style of trading one employs.

 

Currency

There are traders interested in trading in a specific country while others trade in international markets. Trading in a specific country requires one to use that country’s currency since exchange rates might affect the value of money. International traders need to understand different currencies and choose an API that matches their requirements. 

 

Scalability

The stock market is one of the most unpredictable industries we have today. There are times when everything will remain normal while other times things are below normal. However, there are times when things could spike, and the API you choose needs to be scalable enough to handle such spikes.

 

Security

Trading in the stock market is a confidential affair. Traders spent a lot of money buying and selling stocks. It, therefore, means that they need to work with a secure trading API. When choosing a stock market API, make sure that you get the one using secure servers and systems.

Finally, developers should choose an API with the functionality that meets their requirements. They need an API that is flexible and can integrate easily with the programming languages and the development environments that they use. With such considerations, both developers and traders will get the APIs that meet all their requirements.

Whisky
ArticlesCommoditiesMarkets

Success Never Tasted So Sweet – Expand Your MIND and Your ASSETS

Whisky

Scotch whisky is a symbol of British craftsmanship and tradition, of durability and reliability. And though it hasn’t been around for ever, it has been recognised throughout history. Its documented story begins in 1494, and tax records of the day show that a friar acquired eight bolls – about 2,500lbs – of malted barley, “wherewith to make aqua vitae”.

Although distillation processes may have changed over time, the value of this commodity has been driven by demand and maturation. As global appreciation of whisky has flourished, people are gradually discovering that limited edition and maturing casks from the most globally renowned distilleries could bring in top returns for those willing to hold their investment.

 

Why Whisky and Why Now?

The global landscape of investments has changed dramatically in recent years, with the general public now having a greater ability to take trading in to their own hands and invest and trade in a range of commodities through online platforms and investment advisors. Technology has led the way in a virtual environment to allow people to discover new and interesting markets which have previously not been explored. This being said, 2020 has also demonstrated the global volatility of stock markets and poor returns on extremely low interest rates, driving them to discover ways to diversify their asset portfolios.

A way of mitigating the risk of investments is to purchase luxury commodities which appreciate in price over the years. It has become increasingly common for people to invest in classic cars, coins, watches and artwork whilst other commodities have not been considered as viable investment opportunities. However, it is now becoming more apparent than ever that assets which have previously been considered as merely a consumer goods, have great potential for long term investors. One such luxury commodity is whisky, which has previously been washed away for our own satisfaction, is now showing great potential as an investment asset. Additionally, whisky is a tax-free asset which other traditional financial assets fail to offer investors.

Firstly, like fine wine, demand outstrips supply. Whisky that is collectible is also in demand for consumers, so a substantial proportion of any limited edition bottling will swiftly become much more limited as much of it is consumed by dedicated whisky lovers. Whisky is bottled after a period of maturation in oak barrels. Legally, this is a minimum of 3 years, but in practice, most whiskies are matured for a minimum of 8 years in order for them to develop their character.

Distilleries will usually have a ‘house style’ represented by a mass-produced bottling of a relatively young malt (such as Glenmorangie’s popular 10 year old). But they will also have older whiskies maturing at the distillery, and they can also bottle older whiskies such as a 15 or 21 year old. They might also bottle the product of a particular cask of vintage whisky, or they might offer different expressions of the whisky such as a ‘port wood finish’ or ‘sherry wood finish’ which means that in addition to being aged in traditional Bourbon barrels, the whisky has been ‘finished’ with a period of additional ageing in a port or sherry barrel which can impart different flavours. These different expressions of the whisky and older malts are the ones that are of interest to investors – production is limited, they are highly prized by collectors and consumers alike. Whiskies from some distilleries are much more collectible than others, so it is important to do due diligence on what will be desirable in the marketplace in a few years’ time when you seek to sell your whiskies on.

As with any investment, it is extremely important to make sure you’re in the best hands and have access to the best platforms in order for your investment to flourish. It is therefore imperative that investors have access to well-known distilleries which already have a reputation for investable whisky. This includes famous Scottish whiskies such as Macallan, Dalmore and Springbank, all of which Elite Wine& Whisky has strong relationships with. The collectability and rarity of whiskies is extremely important when considering investing in whisky and hence choosing the right distillery and age of cask or bottle is important when investing.

 

Whisky Market in 2020

In the last year, there was an extraordinary increase of between 15-20% on rare whisky bottle values, ensuring that it outperformed the established alternative asset investments such as watches, art and cars. In the last couple of years, we have witnessed some incredible whisky sales, including the following: An individual bottle of Macallan 1926 broke records at auction, selling for £1.5 million. In 2018, over £40.7m of rare whisky was sold at auction houses in the UK alone. A cask of Macallan distilled in 1989 sold for $572,000 last year – a record price for a maturing cask of whisky.

The Whisky Cask Index, a study generated by Cask 88, Braeburn Whisky and WhiskyStats.net, has shown steady growth across the previous year, as well as the rate at which casks appreciate annually being on the rise. This appreciating rate can be attributed to the positive impact of both the maturity of the whisky, as well as a response to the increasing demand as whisky supply is sold in to a more diverse range of global markets.

 

Comparison with Other Investments

Comparisons are made between the whisky cask market and other luxury commodities; however there are many features of whisky which make it unique. It is therefore challenging to analyse the market without considering variable factors, such as the characteristics of the cask that make it one of a kind. The complexity is also enhanced by the fact that, unlike a piece of art, or a collectible bottle of already-bottled whisky, the value of casks is not only dependent on demand, but also the maturation of the cask. Therefore a cask purchased this year will effectively become a new product as the years pass.

The Whisky Cask Index demonstrates the projected values of a sample of twenty casks from a variation of distilleries across the globe with varying age profiles. It is worth noting that in spite of the global pandemic which impacted the economy during early 2020, the Whisky Cask Index has remained optimistic, and even shown growth. In this data analysis not a single distillery index showed negative returns over the past 5 years, which is able to confirm that the market is relatively robust to negative impacts on the global economy.

 

Top 10 Distilleries

Overall Annual Capital Growth in this study across all distilleries and regions as of June 2020 demonstrated a 13% increase in value. This has further been broken down by distillery in order to understand the highest achieving distilleries by capital growth. The top 10 distilleries by capital growth are as follows; Laphroaig, Bunnahabhain, Staoisha, Macallan, Highland Park, Caol ILA, Springbank, Benriach, Bowmore and Jura.

It is extremely positive that no single Scottish distillery demonstrated a negative index in capital growth. Projections ranged from a predicted annual capital growth of 5.13% for a small Scottish distillery, Ardmore, to larger scale popular distilleries such as Laphroaig and Macallan, which both show projected returns approaching 20% per annum.

The top distillery by predicted annual growth is Laphroaig, in which demand is continually increasing past supply. The following two distilleries in the league table are both located in Islay, with both Bunnahabhain and Staoisha showcasing the popularity of this region. In terms of distillery territories, it is worth noting that whisky produced on Scottish islands dominate the top ten in the capital growth league table with only Macallan, Springbank and BenRiach representing mainland distilleries in this comparative list.

 

2021 Trends

As the whisky market grows and expands into new and established markets, it has been predicted that demand will therefore align with this growth and therefore will require supply to also increase. With increased worldwide demand of whisky, the value of whisky in casks will only increase, in particular more aged whisky, along with the value of whisky produced in 2020 and 2021 during the global pandemic due to the closures of distilleries which meant that there was reduced supply. It is therefore no surprise that name brand whiskies distilled in 2020 or 2021 will see an acceleration in growth due to the lack of availability over this time frame and increased demand making it highly investible whisky.

Recent data collated this year has been reflective of the trends which have been witnessed in the whisky market over the past few years, with extremely reassuring outcomes. This is particularly noticeable in the fact that the aforementioned whisky index did not record any negative returns throughout the period of the study. The projected annual capital growth across the distilleries is expected to continue in to 2021.

If growth continues at a comparable rate, the data suggests that investments made in to casks from one of the top ten distilleries, which Elite Wine & Whisky has access to, could see their investment double in value over the next 5 years. In times of great uncertainty, these findings provide great prospects for future days ahead.

 

How to invest in whisky

Whether or not you’re a passionate whisky drinker, taking the plunge in to whisky investment is extremely simple with the help of a financial expert who can educate investors in their investment. Once you have all the tools to make a well informed choice, the returns can be just as fruitful as the drinking.

Forex
ArticlesMarkets

Why the Best Lessons in Forex Trading Tend to be Self-taught

Forex

Learning to trade forex can be a daunting prospect for new investors and there is often an inclination to buy into expensive training courses to prepare for the world of finance. While some sort of education will stand you in good stead for your forex journey, there is no substitute for real life, self-taught experiences.

To get started, you need to select a forex broker that offers an MT5 Trading Platform with a range of features that will make trading easier for you. This is crucial if you are planning to rely on self-teaching as you will need high-quality tools, charts, technical indicators and order types to enter and exit the market at the right time.

 

Getting to grips with leverage

Another factor to consider at this point is leverage. You will be able to trade “on margin” in forex, which will make your initial deposit go further. Brokers generally offer higher leverage for forex, enabling you to trade large positions and potentially increase your returns. However, it can also magnify losses, so you should wield this carefully when you start out.

Using leverage effectively is something that you can only learn when you start trading with real money. While training accounts can help you to learn these concepts, it is much more difficult to put them into practice in a “live” environment. Learning the right lessons about leverage as you start out will make you a better investor in the long term.

 

Understanding the psychological pressure

Many lessons that are self-taught are also related to the emotional side of trading forex. Again, in practice, it is easier to swallow losses and not get carried away with a hot streak of gains, but when you start trading properly, working on your “soft” skills will help you buy and sell currencies in the right frame of mind. Correct decision making can be linked to your character and disposition as much as having the best information.

This also extends to the psychological pressure of making trades on a daily basis. This is something that you will only realize when you begin trading. Even the best courses cannot prepare you for what it is really like to make fast, hard decisions that could affect your finances. That’s why it is also important to implement some degree of bankroll management, so your positions don’t consume all of your money. Experienced traders typically follow a 1%-2% rule for investing.

 

Finding the right information

Promises about quick profits from “trading gurus” and experts can be enticing for new traders but rarely is there ever a get rich strategy that works quickly. Rather than spending money on vendors that over-exaggerate quick return on investments, you should instead focus on finding good information that you can make use of to complete judicious trades.

Partnering with the right broker is vital as you will need access to interactive charts, technical indicators and analysis charts to identify currencies for investment. By practicing and putting these features into use, you can learn more from them and prepare to trade forex with steady, long-term returns in mind.

 

Learning for free

It is important to remember that it is relatively easy for investors to trade forex. All you need to do is open an account and make a minimum deposit. The low barrier to entry means anyone with a small investment can learn to trade currencies for “free” without having to spend money on an education. Arguably, this is a great place to start as you will have a blank canvas to work from.

It is crucial that you read free articles, tutorials and guides to educate yourself about key forex concepts to build a specific strategy or style of trading that can eventually deliver consistent profits. Without this hands-on, self-taught process, you will struggle to make sense of the fast-paced forex environment.

 

Closing trades

Finally, traders are focused on making profits, but central to that is knowing when to close a trade and exit the market. This is something that only experience can teach. Even traders who have trained for months or even years can fall into a trap of waiting for the market to turn back in their favor. Financial markets are inherently volatile and irrational, so you need to act decisively when both entering and exiting trades. All of these self-taught lessons are invaluable and will give you a better chance of succeeding when trading forex.

Recession
ArticlesFinanceMarkets

The Next Great Depression — Is Your Business Ready?

Recession

By Wisteria

We are living through extremely uncertain times regarding both public safety and the global economy. Even before the Covid-19 pandemic swept the world, we were teetering on the brink of a recession. Economists such as David Blanchflower compared the pre-Covid financial landscape to that of pre-banking crash 2008. If nothing else, this is a major red flag which should give you the motivation you need to take every possible measure to protect your business.

 

Is an international recession on the horizon?

At the very beginning of the year, the UN warned that we could be facing a global recession in 2021. That was before taking the impact of Covid-19 into account. Factors including trade wars, currency fluctuations, and Brexit were all amounting to an uncertain global economy and the Unctad report, “global growth will fall from 3% in 2018 to 2.3% this year — its weakest since the 1.7% contraction in 2009”.

Add the impact of Covid-19 to the already precarious situation, and we are now expecting to be hit with a recession rivalling even the magnitude of the Great Depression (and far worse than the 2008 financial crash). As of June this year, the global growth projection for 2020 has fallen to -4.9 per cent (1.9 per cent below the forecast made by the World Economic Outlook (WEO) in April). In addition, the road to recovery doesn’t look like it will be as fast as the WEO initially predicted, and they are now only forecasting a 5.4 per cent global growth for 2021, 6.5 per cent lower than the predictions before Covid-19. Low income households are expected to feel a particular acute financial impact, and global poverty, which has been significantly reduced since the 1990s, is likely to reach another crisis point.

Because of strain on the global economy, we are expected to encounter rising levels of debt in both developing and advanced countries, as well as a “global downturn that could increase unemployment and inequality”, as stated by Kristalina Georgieva of the International Monetary Fund. Redundancies and a decline in job vacancies on an international basis are expected to follow such a crash, with unemployment rates increasing at an alarming rate.

 

How hard will the UK be hit?

The OECD’s (Organisation for Economic Co-operation and Development) most recent reports do not look promising. Experts have predicted that the UK will likely be the worst hit country in Europe and the economy is forecasted to contract by 11.5 per cent after the first wave of the pandemic. If we end up seeing a second of Covid-19 later in the year, this contraction is predicted to increase to 14 per cent.

One of the major reasons why the UK is likely to feel such a stark economic impact is our country’s reliance on the service industry for our economic growth, a sector which has been particularly damaged by the repercussions of Covid-19.

In addition to the economic factors surrounding Covid-19, the US trade war with China has caused a larger drag on global growth than anticipated, and the UK will be on the receiving end of the economic repercussions. What’s more, the looming prospect of Brexit poses different threats to the UK’s economy. At best, the uncertainty caused by both Brexit and the Covid-19 pandemic has created a hesitant consumer base in the UK. Customers are spending less and are more cautious of businesses than ever. It is a difficult time to maintain customer loyalty, as would-be consumers are tightening their purses in the fear of a looming financial disaster.

 

Learn how to protect your business

Times may be challenging, but if you think ahead, you’ll be able to safeguard your business against a recession. Businesses that prepare for every eventuality are the ones that not only survive but thrive in the face of adversity. Leaving it too late to implement a recession strategy could be your undoing, so get ahead of the game and prepare for a period of great financial difficulty. Here are some key strategies that will help your business face economic uncertainty:

  • Focus on existing customers — as we have discussed, consumers aren’t spending as much due to lack of trust and growing apprehension. Because of this, it is essential that you focus on your existing customer base during testing financial times. This will increase brand loyalty and grow customer confidence. Offer them benefits and reasons to stay true to your brand.

  • Put some adjacency and extension strategies in motion — a recession is not the time to start looking into completely new avenues of profit. However, you can’t let your services become stagnant. Adjacency strategy is the optimum solution to this — find an area adjacent to your core product or services to expand into. Extension strategy is similar: take your current service a little further and offer new and exciting opportunities or products to existing customers. Ensure that you have a flexed forecast so that the business is fully prepared for all possible outcomes of this new strategy.

  • Forge some powerful alliances — mergers, acquisitions, and alliances are all key strategies during a recession. Alliances offer a great way to expand your business without investing in anything completely new during times of uncertainty.

  • Don’t be afraid to outsource — outsourcing key elements of your business can save you time, money, and financial anxiety during a recession. Outsourcing your accounts department may allow you create scale and flexibility within your organisation.

  • Reduce inventory costs — look to see if your business has the leeway to reduce costs without sacrificing the quality of the services or products it provides. This will help to take the pressure off your finances.

  • Don’t sacrifice your marketing budget — often, brands make cuts to their marketing budgets in response to financial anxiety. However, this will spell disaster for your company. There is no time more crucial to maintain your marketing efforts and show customers that your brand is tackling the recession and winning.

  • Tighten up on your corporate governance — companies that see a downturn in performance are more likely to survive if they have good corporate governance embedded into their culture. Part of this is ensuring that the company has had a financial audit. If in doubt, contact an accountancy from that specialises in audits, tax advice, and small business VAT.

No one knows quite what to expect over the coming months and years, but now is the time to start safeguarding your business against an imminent recession. The road ahead does not look easy, but if you put certain measures in place and react in a timely manner, there’s still time to recession-proof your business and come out on top.

Business man using a laptop to trade stocks
ArticlesMarketsStock Markets

3 Strategies That Could Help Improve Your Day Trading Profits

Business man using a laptop to trade stocks

Utilising day trading strategies can be a great help to those looking for ways to capitalise on small, frequent price movements.

Whilst trading in financial markets, you will notice various popular trading strategies many use. However, you will also notice that the success you have using one strategy, may differ from the success someone else had. Meaning, that you have to trial and choose which trading strategy is the best one for you.

These are a selection of techniques for you to trial and decide which one is the best trading strategy for you.

 

Invest In Learning About Algorithmic Trading

As artificial intelligence and machine learning continue to rise, so has the advancement in algorithmic trading. This innovative tactic uses computer programs to automatically place buy and sell orders following a specified set of rules. In doing so, the trade should generate profits at a speed that is impossible to achieve by a human trader.

Understanding the rules of algorithmic trading and how it works can be challenging without support. Similar to the rise in artificial intelligence courses becoming available, there are algorithmic trading programmes designed to provide you with the tools to discover market efficiencies and make a higher volume of frequent trades. For instance, this algorithmic trading programme is aimed at those working in the trading space as well as those wanting to gain a deeper understanding of algorithmic trading and the potential it has. The course focuses on developing your ability to successfully implement your trading strategies.

 

Avoid Over And Under Trading

A common trait shared by most traders is being ambitious. Unfortunately, there is a time where they are too ambitious. With a feeling that they must always be doing something, many traders often forget the importance of patience and the quality of the trades. Both of which place higher importance over the number of trades.

Aside from overtrading, under-trading is also a common issue. Traders will find the right setup but fail to conduct the trade, whether it is due to analysis paralysis or lack of self-confidence, or another reason.

 

Put Plans In Place In Case Weakness Strikes

Every trader has their strengths and weaknesses, which over time become more noticeable to them. For instance, their weakness could be not taking a loss when they should. Instead, the loss gradually becomes bigger. Another weakness could be taking trades that do not align with their trading plan, which means the trades are based on an unproven strategy, potentially causing greater losses.

Identify your weaknesses and create a personal plan for how you will respond in the event you notice yourself making one of these errors. There are various tactics you can implement to help you eradicate or prevent causing yourself greater losses. Included in your plan could be closing trades immediately and taking a mandatory break after. This will prevent you from losing more than you already have, as well as allow you time to refocus your attention back to trading.

 

Finding the right trading strategy for you will take time and experience. It is a case of seeing which tactics do not work and avoid using them and instead, find ones that do work or that need adjusting slightly to see an improvement in your daily trading profits. Whilst the concept of trial and error sounds time-consuming it’s certainly worthwhile.

Stocks
ArticlesCapital Markets (stocks and bonds)MarketsStock Markets

Quick Tips to Help You Start Buying and Selling Stocks on a Busy Schedule

Stocks

Very few of us are blessed with a lot of spare time at the moment. The pandemic has hit us all extremely hard, and if we’re not worrying about our health or our jobs, we’re looking for ways that we can shore up our finances with some good investments in case there are more rainy days to come. Now, you might think that the only way to make any real money on the stock market is to treat it essentially as a full-time job. But buying and selling stocks and shares has never been easier, and if you know what you’re doing, it is a great way to improve your investment portfolio.

If you want to get started trading quickly, then there are a few simple steps that you need to take. Some are about making you more confident and capable to make the kinds of moves that you need to be making to actually see a return on your investment. Some are about keeping you safe in both in terms of potential losses and from cybersecurity threats. Let’s break down the most important things that you need to know before you dive in.

 

Research Which Trading Platform You Want to Be Using

The easiest way to get trading quickly and to make sure that you’re comfortable doing so is by finding the right trading platform. There are many different platforms out there and most of them are aimed at different kinds of traders with different kinds of needs. For example, people in high finance who have been trading for years would not be using the kind of platform aimed at a nervous first timer who wants to keep things as low-stakes as possible.

One of the most common things that both veterans and rookies look for is an ETF platform. ETF stands for exchange-traded funds, which means that you can make one investment which translates into investing in hundreds of different funds. You can create a diversified portfolio with a single click. There are several different platforms that provide this, but you will need to be keeping an eye out for fees, the range of assets, markets and economies you can invest in, customer support and the regulation it is subject to. Instead of scrolling results for best ETF trading platform UK, read this guide to the pros and cons of each of the major platforms. BuyShares offers detailed breakdowns to trading and investing for every experience level.

 

Know How Much You Have to Spend

If you want to get started trading as soon as possible, then you need to make sure that you have the funds to do so. Most platforms will offer you a few different payment options, whether that’s through your credit or debit card, PayPal and so on, but the important thing is that you absolutely must know how much you have to work with.

Having a crystal-clear idea will allow you to sell and buy with confidence, and it will also help you to avoid spending more than you can afford. It is important to remember that there are no guarantees on the stock market, and that even a “sure thing” is vulnerable to fluctuations. Do your budgeting before you get started so you don’t make any mistakes you can’t fix.

 

Keep Your Finger on the Pulse

Some investors are what’s known as “passive.” That means that they are perfectly happy to buy their shares and leave them to (hopefully) appreciate in value with as little involvement from them as possible. Everyone else is described as “active”, meaning that they are constantly checking on their stock performance to see if now is the time to check out or double down on their investment.

If you’re going to be the latter and you want to get started right away, then you should make sure that you have the tools and the time. Choosing the right trading platform will give you a great head start, and many will have a mobile app to help you keep tabs on your investments wherever you are. Online trading has seen a real boom during the pandemic so you won’t be short on options.

 

Get Your Security In Place Now

It probably won’t have escaped your notice that online scams and cybercrime rose to deeply worrying levels over the course of the pandemic. These scams aren’t just about people getting text messages about missed deliveries, vaccine appointments or people lying about their COVID status. We’ve seen everyone from major corporations to small businesses face issues with their finances and data. If you’re looking at getting into trading, then security is not a step that you can afford to miss, no matter how much of a hurry you’re in. Check out your platform’s security measures and don’t be afraid to ask questions if you have any particular causes for concern. Set up a different email address for trading, take greater care with your passwords and be as careful as you can.

Trading Chart
ArticlesMarkets

3 Things to Remember Before You Start Trading

Trading Chart


Trading is not something you can engage with on blind optimism alone. To succeed, you require a specific frame of mind.

Professional traders buy and sell financial instruments, such as stocks and bonds, and time their exchanges with precision for optimum returns. They don’t invest long-term either, but rather make a succession of deals so that they can turn themselves a faster profit.

Still, the trading challenges are plentiful, and you can expect to face some degree of hardship on your journey. Instead of learning through trial and error, we’ve compiled some advice to help you get started below.

 

Know Yourself

Traders know who they are at their core and don’t buckle under pressure. They aren’t overly ambitious, nor do they rush their decision-making processes.

You need to be a headstrong individual if you’re to succeed in trading, eager to follow your instincts and chart your own path to success. However, it’s vital to undergo a measured approach and to know your limits from the start.

Small-time investors often use online investment platforms, but the pressures can be insurmountable if they’re inexperienced in the world of trading. Unless you have a sizable amount of trading capital you can freely squander without consequence, this isn’t something you can throw yourself into with vague hopes. Craft is required first.

Traders also bring much of themselves to their pursuit. You’ll need to power through stress, make sacrifices in your timekeeping, and continuously research trading strategies to polish your skills. If you feel you possess that level of commitment, you’re ready to proceed to the next step.

 

Adopt a Learner’s Mentality

Traders’ instincts are sharp, and they refine them over the sum of years. They also pair their intuition with learned knowledge.

If possible, find a mentor figure whose wisdom you can tap into. Regularly consult them for guidance throughout your trading career. Be sure to temper your expectations with the perspective afforded by your experiences.

Traders are smart enough to know that the learning process never stops. They’ll embark on trading courses to embolden their prospects and learn about algorithmic trading. These programmes will help you unearth market efficiencies, recognise profitable market patterns and make trades at higher frequencies. Algorithmic trading courses are aimed at professional traders and newcomers alike, so keep them in mind as you advance your career.

 

Anticipate Changes

Traders are often mischaracterised as deceptive individuals, but they operate firmly within the bounds of many laws.

These laws vary from country to country. For instance, Thailand has their own trading rules and regulations that must be adhered to. Foreigners are banned from operating in specific sectors, while business there is generally conducted in an intensely personal and formal fashion. Certain jokes are unwelcome, and you can expect any associates to want to know you deeply before lifting a finger in trading with you.

It’s essential to be sensitive to any cultural differences when you’re trading internationally. Otherwise, you’ll encounter numerous roadblocks, and time is money for traders. Conduct all your research of what is required in each country and then commence with your plans. 

Trader’s must be confident, intuitive, and educated if they hope to succeed in their endeavours.

Crypto Bitcoin
BankingMarkets

More than Half the Nation View Cryptocurrency Trading as Form of Gambling

Crypto Bitcoin

More than half (56%) of Brits deem cryptocurrency trading as a form of gambling, according to a new study from Gamban, a software company that blocks access to online gambling sites and apps across all of a person’s devices.
After speaking with 1,007 gamblers throughout the country, the research also found that nearly half (48%) would consider stock trading a form of gambling too.
Previous research has identified that excessive trading can be linked to a gambling disorder. Grall-Bronnec et al (2017) found that addictive-like trading behaviour can be a subset of gambling disorders. Similarly, a study by Mills et al (2019) revealed more than 50% of regular gamblers have traded cryptocurrencies in the previous year and that this was associated with an increased risk for problem gambling, depression and anxiety. 
Jack Symons, CEO of Gamban, said: “The aim of this research was to help us understand whether different types of trading are considered gambling. In a world where the lure of immediate gratification through digital platforms is increasingly tempting, it’s important that we take appropriate steps to ensure our users are protected from any activities that closely resemble gambling.
“Understanding whether the content we block should expand beyond the traditional forms of gambling will allow us to better protect our users. As well as this, we can then begin to provide recommendations on reducing gambling harm.”
In the last few years – and especially during the coronavirus pandemic – online trading, including cryptocurrency trading, has grown significantly (Nefedova et al., 2020) The increase in online trading activity has resulted in the birth of new online trading platforms, larger budgets dedicated to advertising on various social media channels and an increased overall awareness of online trading. Additionally, cryptocurrency trading has seen a significant rise over the last year with many day traders “shifting their attention to more speculative assets” (Financial Times, 2021).
Jack Symons added: “The results of our research, paired with current available literature, indicates that trading and gambling share similar characteristics and that some forms of trading may be closely linked with gambling harm. 
“Problem gamblers may be at risk when exposed to different forms of online trading. More volatile forms of trading, like cryptocurrency and stock trading, are more akin to betting than investing. So as of next month we intend to restrict access to platforms that offer these more volatile forms of trading to benefit the recovery journey of Gamban users.”
Gamban works with the the self-exclusion scheme GAMSTOP, and the leading treatment provider GamCare, giving those experiencing harm from gambling access to their software for free through TalkBanStop.com
Gamban also struck a partnership with Norway’s government-owned national lottery and gaming operator, Norsk Tipping, to provide its software for free to those who self-exclude.
Trading
ArticlesMarkets

Answering the Nation’s Top 10 Trading Questions

Trading

By Annie Charalambous, Head of Communications at ETX Capital

The past year has been challenging on all fronts, the least of which being the nation’s finances. With many furloughed or having lost their jobs altogether, financial stresses are mounting, and getting the most out of our money is more important than ever.

As interest rates sit at historic lows, people are starting to rethink just how and where they invest their savings, and trading is one such avenue that’s seen a rise in activity over the pandemic.

Over at ETX Capital, we know that making an educated decision is imperative to success, and so we’ve looked at Google search data to reveal the most common questions budding UK traders are asking, and answered them.

 

What is stock trading? (9,900 monthly searches)

Stocks, or shares, are fractions of ownership in a publicly traded company, that anybody can buy (or sell) depending on the perceived value of that business. Traditionally, you’d want to get in (buy) at a lower price and hold onto that stock until it appreciates in value for you to make a profit.

 

What is options trading? (8,100 monthly searches)

Options are financial contracts that give their holders the ability – but not the obligation (hence option) – to buy or sell a security for an agreed-upon price on a set date, thus hedging against the risk of fluctuating market prices.

 

What is a CFD? (6,600 monthly searches)

A CFD, or Contract for Difference, is another type of trading contract, whereby you are speculating on the direction an instrument may move in, without owning the underlying asset.

You are therefore trading on the price fluctuation – “buying” if you believe its value will increase over time, or “selling” if you anticipate a decline.

 

What is forex trading? (5,400 monthly searches)

Forex, coming from foreign exchange, refers to the buying and selling of different currencies to profit from the difference in their values. The forex market is the largest in the world, seeing over $6 trillion a day in volume – everyone from holidaymakers to big banks partake in the FX market.

 

What is leveraged trading? (5,400 monthly searches)

Leveraged trading works in such a way that a retail trader can open a larger trade with less capital, with the broker putting up the rest of the balance (i.e., the leverage).

Having larger position sizes means your exposure is higher, resulting in bigger returns and conversely, bigger losses.

 

What is futures trading? (2,900 monthly searches)

Futures contracts work in such a way that two parties – a buyer and a seller – agree to exchange an asset on a fixed future date, with the profit (or loss) realized at the time of exchange.

Your profit or loss is realised at the time of the exchange, depending on how the price has fluctuated since the order was placed.

 

What is scalping? (2,900 monthly searches)

Scalping is the act of placing trades you intend to keep open for a very short amount of time, ranging from a few seconds to several minutes, to capitalize on high volatility or sharp spikes in the market.

While there are brokers that may allow scalping in some capacity, it is a form of market abuse if done frequently.

 

How to trade stocks (2,400 monthly searches)

As with any investment, research is the first step.

From choosing the right broker (you’ll want to consider fees, liquidity, selection of stocks, and of course, reputation) to finding the right markets to invest in, you should always know why you’re investing in a particular stock.

Some factors worth looking at may include analysts’ projections for stock performance, the company’s financial results (or earnings), published quarterly, as well as the dividends it pays out.

 

How are commodities traded? (2,400 monthly searches)

Commodities are, typically finite, physical products that have a fluctuating value. There are both hard and soft commodities, ranging from gold, silver, oil, and other natural resources to the likes of coffee, wheat, corn, and even orange juice.

Their value is dependent on supply and demand and can be influenced by anything from weather to politics.

 

How to trade cryptocurrencies (1,900 monthly searches)

Like forex and stocks, cryptocurrencies can be traded as either CFD products or bought and held in a virtual wallet. While more volatile than other traditional assets, cryptocurrencies can be a profitable investment if, like any instrument, you get in at the right time.

When trading crypto CFDs, you can short or sell, meaning you can profit from the drops and not just a rise in value.