Year: 2019

  • New Elon Musk’s AI Fake Text Generator is Too Dangerous to Release

    New Elon Musk’s AI Fake Text Generator is Too Dangerous to Release

    2 min read

    New Elon Musk’s AI Fake Text Generator is Too Dangerous to Release
    We are all aware of the problem of fake news online, and not only online.  

    Elon Musk-backed AI Company claims it made a Text Generator that’s too dangerous to release.

    What is it all about?

    The OpenAI has developed an AI system that can create such impressive fake news content. But the group is too afraid to release it publicly. Their fears are referring to misuse.

    They’re letting researchers see a small part of their work.

    So we cannot say they are hiding it completely. But, the group’s fear here is very weird.

    The developers used 40GB of data pulled from 8 million web pages to train the GPT-2 software. That’s ten times the amount of data they used for the first of GPT.

    This time they trailed dataset together by trolling through Reddit. And they were selecting links to articles that had more than three upvotes. When the training process was complete, they found that the software needs a small amount of text to continue writing.

    The software has trouble with “highly technical or esoteric types of content”. But when it comes to a more conversational type of writing it generated “reasonable samples” 50 percent of the time.

    “Our model, called GPT-2, was trained simply to predict the next word in 40GB of Internet text,” writes a new OpenAI blog. “Due to our concerns about malicious applications of the technology, we are not releasing the trained model. As an experiment in responsible disclosure, we are instead releasing a much smaller model for researchers to experiment with, as well as a technical paper.”

    AI is good but risking

    OpenAI, a nonprofit research company backed by Elon Musk, Reid Hoffman, Sam Altman, and others, says its new AI model, called GPT2 is so good and the risk of malicious use so high. That’s why they are breaking from its normal practice of releasing full research to the public. Instead, they will allow more time to discuss the ramifications of this technological discovery.

    How does it work? Here is one example.

    The software was supplied this paragraph:

    ”In a shocking finding, scientist discovered a herd of unicorns living in a remote, previously unexplored valley, in the Andes Mountains. Even more surprising to the researchers was the fact that the unicorns spoke perfect English.”

    Based on two sentences, it was able to continue writing a news story for another nine paragraphs in a fashion that could have seemingly been written by a human being.

    Here are the next few sentences that were produced by the machine:

    ”The scientist named the population, after their distinctive horn, Ovid’s Unicorn. These four-horned, silver-white unicorns were previously unknown to science.

    Now, after almost two centuries, the mystery of what sparked this odd phenomenon is finally solved.

    Dr. Jorge Pérez, an evolutionary biologist from the University of La Paz, and several companions were exploring the Andes Mountains when they found a small valley, with no other animals or humans. Pérez noticed that the valley had what appeared to be a natural fountain, surrounded by two peaks of rock and silver snow.”

    The Guardian was able to take the software for a test and tried out the first line of George Orwell’s Nineteen Eighty-Four: “It was a bright cold day in April, and the clocks were striking thirteen.”

    The AI program selected among the tone of the choices and proceeded with own dystopian science fiction:

    ”I was in my car on my way to a new job in Seattle. I put the gas in, put the key in, and then I let it run. I just imagined what the day would be like. A hundred years from now. In 2045, I was a teacher in some school in a poor part of rural China. I started with Chinese history and history of science.”

    What a story!!!

    Can you imagine what such a system could do, for example, with president candidate biography?

    The assumptions of this are why OpenAI says it’s only releasing publicly a very small portion of the GPT-2 sampling code.
    It’s not releasing any of the dataset, training code, or “GPT-2 model weights.”

    The OpenAI blog announces this:

    “We are aware that some researchers have the technical capacity to reproduce and open source of our results. We believe our release strategy limits the initial set of organizations who may choose to do this, and gives the AI community more time to have a discussion about the implications of such systems.”

    Fake news is the obvious potential downsides. The AI’s is unfiltered nature. It is trained on the internet, so it is not hard to inspire it to generate biased text, conspiracy theories and so on.

    “We need to perform experimentation to find out what they can and can’t do,” said Jack Clark, the nonprofit company’s head of policy. “If you can’t anticipate all the abilities of a model, you have to prod it to see what it can do. There are many more people than us who are better at thinking what it can do maliciously.”

    Yes, keep this AI away from using a bit more time, please.

    The bottom line

    AI, Artificial intelligence can be extremely useful for everyday life to the implementation in the stock market. A lot of modern tools we are using every day have some part of AI. It is a high-tech’s geeks dream to implement AI everywhere. But it isn’t possible. Something has to be done by humans.

     risk disclosure

  • Cryptocurrency Stocks – The Best to Buy in 2019

    Cryptocurrency Stocks – The Best to Buy in 2019

    Cryptocurrency Stocks - The Best to Buy in 2019Instead of buying cryptos, you can invest in it, you just have to choose will you do it directly or indirectly. Traders-Paradise explains how to invest in cryptocurrency stocks.

    By Guy Avtalyon

    Cryptocurrency stocks are continuing to attract new investors in 2019. However, most beginners have problems finding the next cryptocurrency to invest in 2019 We understand how upsetting it is when you first begin looking for cryptocurrency investments. And that’s why we want to help.

    We can understand your wondering “Should I be investing in Bitcoin or Ethereum or some other crypto?”

    We want to explain how to invest in cryptocurrency stocks.

    This is for you, beginners.

    You’ll have to decide on the way how you want to invest in cryptocurrency: directly or through, for example, the stocks, which is indirectly way.

    Then, if you want to invest directly, you’ll need to decide if you want to be in direct control of your cryptocurrency, or if you would like to use some custodial service.

    A lot of things is already said about the future of cryptocurrencies. Some people believe that the cryptocurrency period won’t last long. On the other side, the others think they’re going to be around forever.

    It is tricky to predict the future of cryptocurrencies, but what we do know is that the demand of cryptocurrencies is only increasing. One of the reasons for that is because of blockchain technology, which is the principal technology behind all cryptocurrencies.

    But before you start, follow Warren Buffett’s advice  “Never invest in something you don’t understand”. Start to read more about cryptocurrencies to go get a sense of information before you dive into the world of cryptocurrencies.

    When you start your learning task, you will find a lot of blogs and videos online. Some of them are very ignorant, but some are too difficult.

    They are either too specific or too general. The learning path isn’t always clear.

    So, let’s make it easier.

    To start investing in cryptocurrency stocks directly you’ll need:

    1. A cryptocurrency wallet. This will provide you with direct control of your cryptocurrency.
    2. A method of obtaining cryptocurrency. Honestly, you will need a cryptocurrency exchange or broker to buy cryptocurrency or to trade cryptocurrency.
    3. A method for selling cryptocurrency. Part of investing is occurring in the ability to cash out. To cash out you’ll probably need to change your cryptocurrency back to some top coin like Bitcoin, Ethereum, or Ripple. So, you’ll need access to the platform that lets you trade those for fiat currencies.

    To start investing in cryptocurrency stocks indirectly through a stock, you’ll need

    First, you’ll need to select between a limited set of options. They include:

    1. A cryptocurrency IRA.
    2. A stock that is related to cryptocurrency.
    3. A private fund which means you’ll need to be an accredited investor and meet certain capital requirements.
    4. Each method of investing in cryptocurrency has its own pros and cons.

    If you know something about the cryptocurrency markets, you then know that 2018 wasn’t an excellent year. Bitcoin has lost 74% of its value last year. The most other major cryptocurrencies have done even worse. Last year, Ripple, Ethereum, and Litecoin are down by 80%, 81%, and 85%, each.

    But, there’s still a lot of interest in blockchain technology and cryptocurrencies. So, it’s possible that we may see a flood in bitcoin or some of the other digital assets.

    That’s why, instead of investing directly in cryptocurrencies, it could be a smart idea to put your money in a business that will do just nice no matter what happens in the cryptocurrency world. And that will do even better, of course, if the crypto world has a good year in 2019.

    What are the best cryptocurrency stocks to buy in Traders Paradise’s opinion?

    1. Bitcoin Investment Trust (GBTC) 

    Barry Silbert has been a figure behind many cryptocurrency trends over many years. He was best recognized for Second Market. It was a well-known system to trade stocks in private companies. His Digital Currency Group (DCG) was originally a part of Second Market, combining a cryptocurrency trading firm called Genesis Global Trading with an asset management firm, Grayscale Investments.

    The Bitcoin Investment Trust (OTCMKTS: GBTC) brings digital currency investment to small investors. It is currently traded through what was called the “pink sheets.” The attempt to get a listing through the NYSEARCA platform having failed in September last year.

    Some investment gurus called GBTC a joke. But they had to face it has won the race and become the first publicly traded Bitcoin fund.

    Moreover, the GBTC value is 85% greater than the value of the bitcoin it has. There are reasons for this. For one, you can buy GBTC in a tax-advantaged account like a retirement account. GBTC is publicly traded, which means you can get out any time you want, and the coins are being kept safely.

    One of the primary media for cryptocurrency news, Coindesk, is a subsidiary of Digital Currency Group (DCG).
    If you are a small investor or investing in a retirement account, GBTC may be the best bet you have for profiting on the future of Bitcoin Nvidia Corporation (NVDA).

    2. Nvidia Corporation (NVDA) cryptocurrency stocks

    Even if you’re not excited in cryptocurrencies, Nvidia Corporation (NASDAQ:NVDA) is a stock worth owning. The stocks increased by nearly 70% during 2017, revenue was growing almost 40% during the same fiscal year. This company is currently possible to reach over $8 billion in revenue and take 25% of that revenue as the net income.

    Nvidia is also a very valuable cryptocurrency stock, with a market cap of $111 billion. It is almost 14 times bigger revenue estimated for this year and a tremendous 53 times earnings. High-performance graphics processors, originally designed for video games, appeared as great for the serious work of finding decryption keys that symbolize crypto-coins. But that is not the only reason to buy it.

    The best reason to buy Nvidia stock is its cloud. Data centers are now going through their first upgrade cycle, to support Artificial Intelligence (AI) applications like voice interfaces, self-driving cars, and the Internet of Things (IoT).

    Instant response is the key here. The low-end processor clouds like those of Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL), just don’t have the processing power needed for the next decade’s growth markets.

    Graphics chip leader NVIDIA has done greatly well in recent years thanks to booming sales for PC gaming and data center applications.

    3. Square (NYSE:SQ)

    Cryptocurrency stocks Square has developed quite a bit over the past few years. At first, it was a niche manufacturer of payment processing hardware for small businesses into a lender.

    Its growth isn’t only impressive. It continues to rise. The company’s revenue increased by 68% year over year in the most recent quarter. Also, the payment processing volume continues to rise, the services-based revenue is 155% higher than a year ago. Also, there is the Cash App, a great source of potential income.

    Square allowed its Cash App customers to begin buying and selling Bitcoin last year. When cryptocurrencies start to experience a recovery, it could evolve into a significant part of the market.

    This is our opinion based on personal experience, paste performances, and data analysis. You may have some other feeling about where to invest. And it is alright. That hunch you have could lead you to the incredible gains. But, our suggestion is to read and examine.

     

  • Swedish Krona set on volatile January Inflation

    Swedish Krona set on volatile January Inflation

    2 min read

    Swedish Krona set on volatile January Inflation
    February 18, 2019
    The Swedish krona is the worst-performing significant currency this year. It faced volatility on Swedish inflation data Tuesday. It looks the markets may be underestimating the risk for a surprise.

    According to SEB AB January is the month of the year with the most volatile inflation data. But a check of one-week price fluctuations in the euro-krona exchange rate implies traders are relatively satisfied.

    One-week implied volatility in the cross is trading around 50 basis points below its one-year average. The relative premium to own exposure to short-term risks stands below par. That suggests investors can hedge themselves through insignificantly under-priced option plays.

    The Swedish krona has been damaged this year by doubt that the country’s central bank can stick to a plan to hike interest rates in the second half of the year.  Karl Steiner, a strategist at SEB said that Inflation is the second-biggest driver for the krona among Swedish data and events, after Riksbank policy announcements.

    “Stars seem to be aligning for out-sized moves in the krona considering the event risks that lie ahead,’’ said Fredrik Lockne, an options specialist at SEB. “Implicit volatility looks rather cheap, in particular over the two-week tenor which captures both inflation and growth data.’’

    January data has the obvious inclination for downside surprises in headline inflation, at 71 percent of the time over the past seven years, SEB said. Swedish consumer prices are forecast to have dropped 0.7 percent in January on a monthly basis, from a 0.4 percent rise in December, as many stores cut prices after Christmas holidays. Inflation is forecast at 2.2 percent in annual terms, versus 2.0 percent in December.

    Swedish Krona set on volatile January Inflation 1

    Image source Bloomberg: Swedish krona

    Best Exchange Rate: 10.6955 on 29/08/2018
    Worst Exchange Rate: 0 on 18/02/2019
    Mid Exchange Rate: 10.3044 on 17/07/2018

    Other currencies:

    EUR/USD

    The trend is bearish in the 1-hour chart. Intraday resistance is at 1.1341 price level. This means, as long as the price stays below 1.1341 resistance level, you should look for sell trades. If bullish candlestick closes above 1.1341 critical resistance level, then down trend is going to end.

    GBP/USD

    The trend is bearish in the 1-hour chart. Intraday resistance is at 1.2995 price level. As long as the price stays below 1.2995 resistance level, you should look for sell trades. If bullish candlestick closes above 1.2995 resistance level, which stands as critical, then down trend is going to end.

    USD/JPY

    The trend is bullish in the 1-hour chart. Intraday support is at 110.08 price level. As long as the price stays above 110.08 support level, you should look for buy trades. If bearish candlestick closes below 110.08 critical support level, then up trend is going to end.

    USD/CAD

    The trend is bullish in the 1-hour chart. Intraday support is at 1.3195 price level. So, as long as the price stays above 1.3195 support level, look for buy trades. If bearish candlestick closes below 1.3195 critical support level, then up trend is going to end.

    USD/CHF

    The trend is bearish in the 1-hour chart. Intraday resistance is present at 1.0110 price level. So, as long as the price stays below 1.0110 resistance level, look for sell trades. If bullish candlestick closes above 1.0110 critical resistance level, then down trend is going to end.

    risk disclosure

  • Wild ride: Dow Jones Rise 250 Points

    Wild ride: Dow Jones Rise 250 Points

    2 min read

    Wild ride: Dow Rise 250 Points
    Stocks rose on Friday amid increasing hopes for a U.S.-China trade deal as equities were on pace to post another solid weekly gain.

    According to CNBC, The Dow Jones Industrial Average jumped 250 points as J.P. Morgan Chase and Caterpillar outperformed. The S&P 500 gained 0.76 percent, led by financials and tech. The Nasdaq Composite advanced 0.4 percent.

    The 30-stock Dow and Nasdaq were both on pace to post their eighth consecutive weekly gain. The S&P 500, meanwhile, was on track for its seventh weekly gain in eight. The indexes were all up more than 1 percent entering Friday’s session.

    Here are the hottest things to know about stocks

    • The Dow Jones Industrial Average, S&P 500 and Nasdaq posted their fourth straight day of gains.
    • The Dow has added more than 1,000 points from Friday to Wednesday.
    • Big gainers on Wednesday included Chipotle Mexican Grill, Fossil Group and Nektar Therapeutics.
    • The Consumer Price Index rose 0.5% in January, the strongest monthly increase since January 2017.
    • The 10-year Treasury note hit 2.91%, a four-year high.

    Stocks ended with sharp gains on Wednesday, February 14, after falling earlier in the session following reading on U.S. consumer inflation.

    The Dow Jones jumped

    The Dow Jones Industrial Average jumped 253 points or 1.03%. The S&P 500 rose 1.34% and the Nasdaq was up 1.86% as technology shares outperformed.

    The leading gainers on the Dow Wednesday were Nike Inc. (NKE – Get Report), Cisco Systems Inc. (CSCO – Get Report) and JPMorgan Chase & Co. (JPM – Get Report). They rose 3%, 2% and 2.3%, respectively.

    Daniel Deming, managing director at KKM Financial said: “I am a bit surprised the market has been able to maintain this upward trajectory at the level that it has… We had a little hiccup last week, but that was quickly priced out of the market. That tells me there is still money trying to seek a higher return, or at least take on more risk.”

    What did cause this Dow Jones jump

    Chinese President Xi Jinping said trade talks between the U.S. and China will continue next week in Washington. This comes after a U.S. trade delegation which was led by Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer visited Beijing this week.

    China and the U.S. are trying to hit a deal before a March deadline. If they don’t reach a deal by then, additional U.S. tariffs on Chinese goods could take effect. President Donald Trump, still, is considering pushing back the deadline by 60 days to give negotiators more time to reach a deal.

     

    Core inflation in the US in January rose 0.3%.

    Wall Street will be looking to the data to help it gain signs about the pace and trajectory of interest rate hikes from the Federal Reserve.

    “This is a strong number. What’s going to be interesting is how financial markets react,” said Luke Bartholomew, investment strategist at Aberdeen Standard Investments.

    “There’s a risk that this could pour fuel on the fire of last week’s market selloff.”

    Bartholomew added that the “Fed is now very likely to follow through on its plan to raise rates again in March.”

    The 10-year Treasury note yield rose to 2.91% on Wednesday, a four-year high.

    The Cboe’s Volatility Index often referred to as the “fear gauge,” fell back below 20.

    U.S. retail sales in January fell 0.3%, but economists had expected a gain of 0.2%. It looks like a not good hint.

    The Friday moves come after the Dow and S&P 500 fell on much weaker-than-forecast retail sales numbers.

    On the data front Friday, industrial production for January fell 0.6 percent. Economists, however, expected an increase of 0.3 percent. They failed once more.

    Consumer sentiment data are scheduled for release later on Friday.

    risk disclosure

  • Nasdaq’s loophole in rules is under investigation

    Nasdaq’s loophole in rules is under investigation

    2 min read

    Nasdaq’s loophole in rules is under investigation 3
    According to The Wall Street Journal,  Nasdaq’s loophole in rules is under scrutiny after a roller-coaster ride in the stock of one small company highlighted how firms can go public without ample shares to trade.

    So, what happened?

    Phunware Inc., a software company preparing to launch its own cryptocurrency, climbed about 3,750% over six trading days to hit an intraday high of $550 a share on January 10. Only 144,000 shares were eligible to freely trade during that period, according to the company. The stock closed at $113.41 on Tuesday.

    Nasdaq’s loophole in the rules 

    Nasdaq’s rules require companies listed on the exchange to have at least one million publicly held shares. The problem is that can incorporate shares which are restricted from trading. Such shares are those owned by employees or early investors who may be required to hold the stock for a period before selling.

    The important fact is that Phunware, Inc. has not issued dividends in more than one year.

    The important fact is that Phunware Inc. has not issued dividends in more than one year.

    Their stock has been volatile due to the small supply of shares that can be freely traded.

    Take a look at the chart below.

    Nasdaq’s loophole in rules is under investigation

    Image: screenshots from Finance Yahoo

    As soon as this week, Nasdaq will move to close the loophole by proposing to exclude restricted shares from the number that firms need to qualify for a listing, according to Nasdaq spokesman Joe Christinat. The Securities and Exchange Commission would need to approve the rule change.

    What really is Nasdaq’s loophole

    Shares of Phunware (NASDAQ: PHUN) rose 1,988% higher in January, according to data from S&P Global Market Intelligence. The provider of development tools for mobile apps, including a unique blockchain-based security token known as PhunCoin, started the month as a penny stock with a $310 million market cap.

    By the end of January, Phunware’s stock closed at nearly $300 per share and a total market value of $9 billion.

    Nasdaq’s loophole in rules is under investigation 2

    Image: screenshots from Finance Yahoo

    The surge started with Phunware establishing its merger with capital investment firm Stellar Acquisition III. The deal led Phunware onto the public markets after a decade of operations as a private company. During the period of two and a half years, they were collecting funds of Stellar Acquisition’s capital to use without a clear purpose.

    Actually, Phunware went public through an unusual backdoor combination.

    Blank-check company

    The Austin-based company merged with a blank-check company that already had a listing on the Nasdaq. Blank-check companies, they are also called special purpose acquisition companies, or SPACs. Their purpose is to raise money from public investors with the goal of using the proceeds to acquire an existing business. The arrangement has gained recognition in the past several years, and Nasdaq is the most popular exchange for blank-check listings.

    Share prices continued to soar as Phunware announced a handful of new patents and developer programs. That programs topped off by a launch platform for a public version of PhunCoin and a blockchain partnership with the powerful IBM.
    The stock has settled down a bit in February and is now trading just 752% higher since the new year.

    The rule change needs approval

    Nasdaq’s loophole has to be closed. The Securities and Exchange Commission would need to approve the rule change. “It shows a need for rethinking these rules,” said James Angel, a finance professor at Georgetown University whose research focuses on securities markets, in his statement for The Wall Street Journal. “We need to have enough shares in public circulation so we don’t have dislocations like we have seen here with Phunware.”

    Phunware recorded revenue of $19.1m and a net loss of $2.6m during the six months ended June 30, 2018. But, Phunware lost $25.9m in 2017. Before the merger, its auditor, Marcum, said that there was “substantial doubt” about its ability to remain solvent.

    Phunware is not a unique case.

    Some other lightly traded stocks that emerged from deals with Nasdaq-listed blank-check companies have also experienced wild price swings.

    Organogenesis Holdings, a developer of surgical and sports medicine products, resumed trading January 8 after merging with a SPAC late last year. The stock opened the following day at $15.60 a share and rose to an intraday high of $310.90 before closing at $82.35. Just 28,209 shares changed hands that day, according to FactSet.

    A large portion of Organogenesis’ shares was restricted and unavailable for immediate trading after the company’s merger with Avista Healthcare Public Acquisition.

    About 4 million Organogenesis shares were unrestricted on Jan. 8. Since then the number has risen to approximately 19 million, said Organogenesis spokeswoman, but she declined to comment on trading activity in the company’s stock.

    The market is still getting excited about crypto

    Phunware’s surge is proof positive that the market still can get excited about blockchain tools and cryptocurrency stocks. But we don’t have any actual business results available for this company yet. Is it an empty bubble with zero long-term value.? Or are we are witnesses of a future titan in the mobile app development market? Only time will tell. It is smart to stay on the sidelines until we know more about the new company’s business plans.

    The bottom line

    Truth is that blank-cheque companies are risky for investors because of their lack of operating history. But they are charming to exchanges, which compete for SPAC initial public offerings. About two years ago Nasdaq proposed to correct its rules to make it easier for blank-check companies to list on the exchange. But, facing shaded examples, Nasdaq ended up withdrawing the proposal last year.

    Phunware, together with its managers and early investors, are now preparing to make available an additional 21 million shares, which would significantly increase the float of the stock, according to a regulatory filing made on February 5.

    risk disclosure

  • Managing Money Online – How Difficult It Can Be?

    Managing Money Online – How Difficult It Can Be?

    Managing money online - nightmare or bright future 2
    Managing money online can be troublesome. It is smart to use some app to work for you

    By Guy Avtalyon

    Managing money online can be a tricky game. Cryptocurrencies, often associated with “geeks” or with those who want to get money quickly, have become a popular form of payment.

    According to a recent report by Kaspersky Lab, every tenth user (13%) has used crypto for purchases so far. However, cybercriminals also accept this trend and increasingly target crypto-markets. By transforming the old threats, these new scammers attack investors.

    Kaspersky Lab examined the habits of 12,448 consumers in 22 countries.

    The crypto users are at constant risk of losing their savings stored through this technology. The hackers develop sophisticated techniques for accessing others’ finances. There is an increasing number of companies offering cryptocurrencies as a payment method, where they are now accepted by both retailers and, for example, food stores.

    Interest for crypto is raising, and even major sports teams are joining on crypto-exchanges. However, people show more interest in using cryptos for investment as well as for spending money. Hence, their digital assets are increasingly subject to theft. Incidents, where stolen digital tokens worth nearly $ 530 million, are known.

    Managing money online

    Visiting the favorite online retailers is fast growing the most comfortable way to make must-have shopping.  Their advantages are fast-tracked delivery, exclusive discounts, and free returns. This made online shopping an interesting and vital part of the present life.

    It’s determined that three-quarters of us have shopped online. Even browsing for goods has become a popular pastime.

    Frankly, all of us are doing it when we are on our breaks, traveling to work, or sitting in front of the television.
    The e-commerce boom has made it easy to spend money online. You can buy almost everything online, from groceries and gifts, clothes, through to paying service providers, or buying a yacht. The opportunities are infinite and the variety of payment options is expanding.

    Managing money online - nightmare or bright future 1

    The image source: kaspersky.com

    The majority of retailers are encouraged us to use whatever payment method we prefer. Of course, in order to stop us from moving elsewhere. From credit card transactions and bank transfers to cryptocurrency, subscriptions, and loyalty points, we can pay for assets and services in more ways than ever before.

    A large-scale spectrum of payment options offers us both choice and flexibility. But it also gives us the difficulty of protecting our financial details in various areas.

    Kaspersky Lab figures suggest that 60% of consumers are worried about online banking fraud. The majority of people having various online shopping accounts, digital wallets, and login credentials. So, it can be a big challenge to hold everything in order and remember every PIN, password, and code.

    Nowadays it isn’t so easy to stay in control.

    Some of us have the problem to remember the email address we used to register with a particular service.

    Kaspersky Lab has uncovered how people manage their finances online. They examined their attitudes toward financial cyber threats. In detail, how safe their money is, and how they value it against the security or other sensitive information.

    And they revealed the risks people are prepared to take when making transactions online. What do the people do to protect their credentials to avoid their hard-earned money to fall into the wrong hands?

    Is our money safe?

    Online shopping now is standard. So, cybercriminals are ready to take advantage of those who fail to protect themselves online. You can’t even imagine how vulnerable our financial information is online.

    For example, in October 2018, American HSBC customers’ account details were accessed by hackers through an advanced breach. That was affecting hundreds of thousands of people. This is a great example of how important is to take control of our own security and not relying on others. No one will keep our information safe as we can do it by ourselves. What can we do ourselves to minimize the chances of becoming a target?

    Trying to write down your financial credentials puts you at risk. Writing a credit card PIN in a notepad, or saving a bank account passcode on a laptop, could expose you more to attack. Hence, result in monetary losses.

    Kaspersky’s survey revealed that a fifth of people (20%) still rely on their smartphone or other devices as a way of noting down private banking information. This is the potential to fall into the wrong hands.

    Managing money online - nightmare or bright future

    The image source: kaspersky.com

    How to remember all our passwords

    Kaspersky Lab found a third of people (31%) still struggle to remember their online banking credentials, admitting that they have either forgotten them or do not even try to remember them.

    Signing up for subscription services is also incredibly tempting. Because it gives us the opportunity to quickly access our favorite television shows, movies, and products. The registration is easy, but it can become very tricky to track spending. 32% of people who answered the survey do not always remember every service or automated payment (direct debit) they have subscribed to. Signing up for two streaming services, a few magazines, and a gym plan can quickly lead to costly fees from multiple brands.

    Password panic when managing money online

    Kaspersky Lab statistics show that more than half of people (52%) are worried about being vulnerable when buying products or making financial transactions online. This result means that a small number of them would prefer if this could be done more securely. The survey also revealed that nearly half of the people (46%) would like to pay for goods online more often. All they need is a reliable protection for these financial transactions.

    A third of shoppers (32%) revealed that they had a financial incident in the past year. This left many of them (26%) out of pocket. As we all know from personal experiences, they were not compensated by any payment provider or retailer involved.
    The good news is that the strong majority of people (83%) believe the most important thing is to set a strong password for online banking, speaking about managing money online.

    Bottom line

    Managing money online, keeping expenses in order, and planning a budget can be tough. You can use personal finance sites that do everything from tracking your spending to helping you get out of debt to managing your bills for you.
    Best of all, if they’re all free.

  • The risk-reward Ratio

    The risk-reward Ratio

    3 min read

     

    The risk-reward ratio is a formula used to measure the expected gains of a given investment against the risk of loss.

    It is typically shown as a figure for the assessed risk separated by a colon from the figure for the prospective reward. The adequate ratio can vary, but trade experts recommend a ratio between 2:1 and 3:1 to determine a worthy investment.  

    Typically, the ratio quantifies the relationship between the potential money lost, should the investment or action fail, versus the money realized if all goes as planned.

    In other words, the risk-reward ratio measures how much your potential reward is, for every coin you risk.

    For example:

    If you have a risk-reward ratio of 1:2, it means you’re risking $1 to potentially make $2.

    But, if you have a risk-reward ratio of 1:4, it means you’re risking $1 to potentially make $4.
    Investors use the risk-reward ratio to define the viability or worthiness of a given investment. You can limit risk by issuing stop-loss orders,  sometimes. That will trigger automatic sales of stock or other securities when they hit a particular price. If you don’t implement such a mechanism in place, the risk is likely endless.

    How to use the risk-reward ratio like a pro

    Let’s be clear: the win rate in trading it totally trivial on its own. Some traders put way too much importance on the win rate. At the same time, they don’t understand that a win rate will not tell you anything about the quality of a practice or a trader.

    The truth is that trader can lose money with a 70% or even with a 90% win rate if few losers are so big that they wipe out trader’s winners. But, the trader can have a successful system even with a win rate of 40% or only 30% if such a trader lets winners run and cut losses short.

    It all comes down to the reward-risk ratio.

    The reward to risk ratio (RRR, or reward risk ratio) is probably the most important metric in trading. A trader who understands the RRR can improve his chances of becoming profitable.

    But, however, there are some myths about risk-reward.

    Myth 1

    “You need a minimum of 1:2 risk reward ratio.”

    That is nonsense.

    Why?

    Because the risk-reward ratio is insignificant on its own.

    We will give you an example:

    Let’s say you have a risk-reward ratio of 1:2. This means, for every trade you win, you make $2.

    But, your winning rate is 30%.

    To have a clear picture, out of 10 trades, you have 7 losing trades and 3 winners.

    Let’s do the math…
    Total Loss = $1 * 7 = -$7
    Total Gain = $2 * 3 = $6
    Net loss = -$1

    You see, you are not the winner.

    And you understand the risk-reward ratio by itself is an insignificant metric.

    There is nothing like good or bad risk-reward ratios. It just comes down to how you use it. You can even trade profitably with a risk-reward ratio of 1:1 or less.

    So, you must combine your risk-reward ratio with your winning rate to know whether you’ll make money in the long run. That is known as your expectancy.

    Myth 2

    The risk-reward ratio is useless

    Some traders like to say the reward-risk ratio is useless. It cannot be further from the truth.

    When you use the RRR in combination with other trading metrics, such as win rate, for example, it instantly matures as one of the most important trading tools.

    Without knowing the risk-reward ratio of a single trade, it is literally impossible to trade profitably.

    The risk-reward ratio isn’t enough

    Do you want to know the secret code?

    Here it is.
    E= [1+ (W/L)] x P – 1

    Now let’s put this all together and let’s take a look at some performance statistics and how the RRR fits in.

    Below, we see a performance simulation based off a strategy with a win rate of 50% and a risk of 2.5% per trade. The RRR was first set to 2:1 on average per trade.

    The Risk - Reward Ratio 3

    You can see that out of those 20 simulated outcomes (the different graphs), all of them were positive after 500 trades.

    Remember, with a win rate of 50%, you just need a RRR greater than 1:1 to trade profitably. With a 2:1 RRR you can potentially trader very profitable with a win rate of 50%.

    Now let’s take a look when the only thing we change is the RRR. Everything else is the same.

    Assume that each trade has a RRR of 1:1.

    Out of the 20 simulated outcomes, only a few will generate a positive outcome and many show a negative outcome.

    To conclude, with a win rate of 50%, trading a RRR of 1:1 is very volatile and variance will be huge. You have to remember, with a win rate of 50%, you need a RRR greater than 1:1.

    Now let’s take a look when the only thing we change is the RRR. Everything else is the same.

    Assume that each trade has a RRR of 1:1.

    Out of the 20 simulated outcomes, only a few will generate a positive outcome and many show a negative outcome.

    The Risk - Reward Ratio 4

    To conclude, with a win rate of 50%, trading a RRR of 1:1 is very volatile and variance will be huge. You have to remember, with a win rate of 50%, you need a RRR greater than 1:1.

    The bottom line

    Portfolio with more unknown factors may have a higher probability of failure but at the same time offer a significantly higher return if they are successful. The ideal is the low risk-reward ratio – the little risk of failure and a high potential for reward. 

    risk disclosure

  • Investing in foreign markets – How to that

    Investing in foreign markets – How to that

    2 min read

    Investing in foreign markets - How to that

    Investing in foreign markets may sound intriguing or intimidating.

    Yes, international investing can be a difficult attempt. There are communication hurdles. Also, there are problems with money transfers to foreign exchanges. And regulations can be tricky. On the other hand, financial advisors suggest holding at least some foreign stocks in a diversified portfolio.

    Luckily, there are easy ways for Investing in foreign markets. That excludes picking up a new language or exchanging your local money for euros or dollars or something like that.

    One of the best ways to diversify your portfolio is to put some of your money in global investments. Foreign markets may react differently to economic conditions than, for example, U.S. markets. It is possible that strong performance abroad helps to compensate for weak performance at home.

    Foreign stocks can diversify your portfolio as we said, but they may open up chances for growth and success. In general, there are three ways you can use to make your portfolio more international in its exposure.

    Having an international stock appearance in your investments is a smart move that can improve your overall returns.

    International stocks add diversification

    You know the idiom: Don’t put all your eggs in one basket.

    This saying is particularly relevant when investing. Diversification or holding a mixture of stocks across different countries, industries, and areas of companies is a simple way to increase long-term investment returns while decreasing risk.

    An easy way to invest internationally is through a mutual fund that holds foreign securities. You get the privilege to choose from stock, bond or money market funds in several categories.

    The easiest way to invest in foreign markets is by buying exchange-traded funds (ETFs) or mutual funds that hold a basket of international stocks and bonds. The foreign holdings over multiple industries and countries, provide investors with the highly-diversified foreign component to their portfolio in just one easy purchase.

    In general, there are three ways you can invest internationally.

    Investing directly in foreign stocks.

    Using internationally focused exchange-traded funds to gain foreign exposure.

    Buying shares of multinational corporations that are based in the U.S. but do almost all of their business internationally.

    Let’s break down each of them.

    Buying foreign stocks directly

    The most reasonable way for Investing in foreign markets is to buy shares of foreign companies. You can find many foreign companies that list their stock on major U.S. exchanges. Moreover, investing in those companies is identical to buying shares of any U.S. company.

    For stocks that aren’t listed on major U.S. exchanges, investing gets complex. Some foreign companies trade on an over-the-counter basis. That makes them available with many brokerage accounts. But, at the same time, makes them subject to less liquid trading conditions.

    Still, other foreign stocks have no U.S. availability at all, so investors have to buy shares directly on foreign stock exchanges. There are limited numbers of brokers offer direct purchase and sale of foreign stocks on exchanges outside the U.S. This means, for example, you can count on finding the exact stock you’re looking for with a great deal of work.

    Try your hand at paper trading with foreign investments you find intriguing. This virtual-trading practice, offered by many online brokers, will allow you to learn to invest in new markets without risking any money.

    Buying international stocks through an ETF

    Many exchange-traded funds have a focus on foreign stocks. They offer a more diversified entrance at international investing. Also, they have a wide variety of different funds to choose from.

    Some international ETFs endeavor to offer stocks of the entire global market. Others focus in on particular regions, countries, industries, or other classifications of international stocks. One of the most common characteristics involves ETFs that focus on stocks in developed markets. That is versus those that concentrate on emerging market stocks. Many ETFs have limitation to one or the other of these groups.

    The benefit of international ETFs is that they’re listed on U.S. stock exchanges and are easy to trade. Fees can be higher than with domestic stock ETFs, so you have to look carefully at costs.

    Buying U.S. stocks that concentrate abroad

    Many U.S. companies have increased their presence to international markets.

    For example, Philip Morris International only sells cigarettes and other tobacco products outside the U.S. Some other companies keep a minimal U.S. presence. But they are available internationally.

    American companies win reputation abroad, especially in the consumer sector. So, the investors have to consider not only U.S. economic and industry conditions but also what companies face in their abroad markets.

    Risks of investing internationally

    Investing internationally carries the same risk associated with all investing. The market conditions can change, causing your investments to lose value.

    Political risk – Changes to government and political systems can cause devastation on a nation’s investment markets.

    Currency risk – Exchange-rate fluctuations can boost or limit investment returns.

    Market risk – Many abroad markets are characterized by wide price oscillations.

    The bottom line

    Investing in foreign markets are a great way to build international exposure in any portfolio. And you don’t have to worry about foreign stocks or regulations. Moreover, investors can achieve proper diversification for their portfolios by Investing in foreign markets.

    risk disclosure

  • Pound falls on Brexit stage fright and BoE Decision

    Pound falls on Brexit stage fright and BoE Decision

    2 min read

    Pound falls on Brexit stage fright and BoE Decision 1

    The Sterling pound yesterday dropped below 2-week lows in the early London session.

    The investors priced-in Brexit uncertainty ahead of a crucial meeting between Theresa May and the European Commission President.

    The GBP/USD currency pair dropped to new 2.5-week lows following the Bank of England‘s interest rate decision in the mid-European session.

    The GBP/USD currency pair yesterday dropped to a low of 1.2855 following the BoE rate decision before rallying to a high of 1.2997 on Mark Carney‘s balanced comments.

    Sterling is trading little changed at around mid 1.2900 before the UK Prime Minister Theresa May reaches Dublin to meet her Irish counterpart and discuss the problematical border plan.

    Cable (GBPUSD, often referred to as “The Cable”) tested fresh lows in the mid-1.2800s on Thursday. Although running to recover some ground later and close the day with small gains. It was a small drop in open interest and a decent raise in volume.

    There is a potential continuation of the bounce, which will leave at the same time occasional dips shallow.

    At the time of writing, the Pound was down 0.02% at $1.2932.

    Pound falls on Brexit stage fright and BoE Decision

    image Pound falls source Yahoo Finance

    The 4 hours chart shows that the pair quickly recovered above its 200 EMA, although it has already tested levels below it. A bearish 20 SMA keeps capping the upside, while technical indicators have recovered from oversold levels, now losing upward strength within negative levels, indicating that the risk of an upward extension remains limited. The pair would need to surpass the 1.3040 resistance to be able to extend its gains toward the 1.3100 price zone, yet as long as Brexit uncertainty prevails, the most likely scenario is sellers taking their chances on spikes above 1.3000.

    Support levels:  1.2925 1.2880 1.2835
    Resistance levels: 1.2995 1.3040 1.3090

    What about shares?

    UK shares were having a good day on Tuesday, with the FTSE 100 has gone from strength to strength as the morning has progressed.

    Shortly before midday, the UK’s benchmark share index was up 106.95 points, or 1.5%, at 7,141.08.

    The index was given a lift early on by BP’s better-than-expected results, which have pushed the oil giant’s shares up more than 5%.

    Shares were also boosted after the pound fell back in the wake of the disappointing survey of the UK services sector.
    Currently, rate is $1 = £0.7728.

    Shares often rise when sterling falls. The weaker currency lifts the value of companies’ overseas earnings when they are brought back to the UK and converted back into pounds.

    Governor Carney’s said on Thursday, that further rate hikes should not be priced out of the Pound.

    Focus returns to Brexit and whether Theresa May can find more support for concessions to deliver a deal pleasant to Parliament.

    All options are still on the table

    With the UK government still working its way to the UK parliament with the Brexit agreement approval, the Brexit uncertainty is set for the next weeks. The 2019 GBP/USD forecast highly depend on the result of the Brexit deal going forward. All options are still on the table leaving different GBP/USD scenarios all applicable.

    Sterling could fall past 1.2000 level that historically frames the bottom and serves as a territory of rebound for GBP/USD in case of hard Brexit. The reasonable solution for all interested parties in the UK parliament, the UK government and in the EU should be to avoid the scenario of no-deal Brexit. That would throw the UK economy and Sterling into confusion with the Bank of England saying the bottom for Sterling would be some 25% lower.

    Also, no transition Brexit would realize an unfavorable scenario for Sterling with falling to the lowest level since 1985 of 1.0700. Such scenarios are still considered doubtful. Should such scenarios develop, it is almost a sure shot for traders while buying GBP/USD at historical or/and cyclical lows.

    The chance of the UK finally making some kind of Brexit deal with the European Union is still the mainstream scenario for the UK and for GBP/USD.

    A no-deal Brexit is still not the most probable scenario for the UK economy going into 2019. The UK parliament stands in deep opposition to the Brexit deal agreed by the government.

    The ruling Conservative party is divided profoundly.

    risk disclosure