CFI.co Blogger, Author at CFI.co Blog

Very few traders pay attention to the size of their trading account. In most cases, the traders are biased in favor of leverage and they are enjoying the high-risk trading environment. But leverage is only for the expert Singaporean traders who know the risk management policy from the core. They often find it hard to manage the leverage trading account. The best practice is to use 1:10 leverage (maximum) while trading the real market. You can say that without using the leverage, you won’t be able to support your family. Well, it depends on the size of your account. If you invest $1000, it’s very obvious you are not going to make a significant profit from this market.

This content is not going to be like a traditional article. We are going to give you some key metrics that will allow you to manage the risk in trading. Most importantly, it will help you to find the amount of money which you must have to live your life with trading business.

Your family needs

First of all identity your family needs. Calculate the basic costs of your family life so that you know the minimum amount of money you need to make per month. In most cases, rookies don’t believe in such an approach. They become fairly aggressive with the trading method and try to earn money without having any goal. But such things are not going to work. This is not how the professionals place their trade in real life. They have specific sets of goals and for this reason, they can make a decent profit from this market. Being a new trader in the Forex market, it will be tough to trade with goals. Without developing these skills, you won’t be able to know the amount of money which you must invest in trading.

Depends on your win rate

The success rate of retail traders in the exchange traded funds greatly varies. You have to know your success rate by using the demo account. Those who have a high success rate can effectively use leverage. So, they will require a small amount of money. On the contrary, those who don’t have a high success rate must trade with a low leverage account. For them, leverage is like a time bomb. They will never know when it costs them a fortune. So, work hard on your trading strategy so that you can have a great win rate in trading. Never try to deal with the market with a low win rate as it makes the trading process much more complicated.

Profit factors

You might be thinking about how much money you can earn from this market. The professional usually makes 5-10%+ profit per month. So, use the simple mathematical calculation and find out how much money you need to support your family. If the number of too big, you must increase the size of your capital. But this should be done professionally. Borrowing money from other people to trade the market is a very big mistake. This is one of the most common reasons why rookies are losing money in trading.

The rookies might not be able to earn so much profit for the first few years. They should be happy with a 2-3% profit per month. Once they become good at analyzing the profit factor, they can easily scale up the size of their account balance.

Conclusion

There is no fixed rule to investing money at trading. But stop investing money that you can’t lose in trading. If we talk about the rule of thumb, it is imperative to invest at least $2000 at the initial stage. Anything less than that will force you to overtrade. Once you start overtrading, you are going to have a very long journey towards success.

Banking

Nigerian bank DLM on the move delivers at all levels – with exciting plans in the pipeline

ByCFI.co Blogger

DLM Capital Group – a developmental investment bank that supports economic and social infrastructure projects with the aim of driving GDP growth and improving lives.

Founding chairman and group CEO of investment firm DLM Capital Group , Sonnie Ayere — Founding chairman and group CEO of investment firm DLM Capital Group, Sonnie Ayere

DLM Advisory Partners (DLMAP), formerly Dunn Loren Merrifield Advisory Partners, is the advisory and capital-raising arm of DLM Capital group. The principal services provided by DLMAP include financial advisory, debt capital-raising, equity capital raising, mergers and acquisitions, and company set-up advisory.

DLMAP has played a leading role in structured finance and securitisation within Nigeria. “We have acted as sole arranger to more than 80 percent of structured finance transactions in Nigeria, and 100 percent of all securitisation transactions in the market,” says CEO Sonnie Ayere.

Most Innovative Transaction of 2019

In 2019, DLM executed the first Bus Rapid Transit (BRT) securitisation in Nigeria, working with the sponsor, Primero Transport Services Limited (PTSL). The system caters to residents of the country’s most densely populated city, Lagos. DLM raised ₦16.50bn ($45.8m) through the securitisation of the company’s BRT tickets receivables. The sponsor is licensed to operate the longest BRT route in West Africa, 35.3km, with its 434-bus fleet.

DLM Capital Group

A feasibility study conducted put the daily passenger carriage at about 226,300 passengers per day. Due to working capital pressures, the company was only able to serve an average of 135,000 daily passengers before the securitisation transaction in 2019.

The ₦16.5bn 17 percent Series 1 Fixed Rate Bonds issued were primarily used to refinance all pre-existing commercial banking loan facilities on the books of the sponsor. The transaction provided the company with savings in interest, shaving the cost of funds from 27 percent per annum to 17 percent. At the same time, it extended the tenor of the company’s debt from three years to seven.

With this transaction, DLM was able to provide the company with up to 10 percent savings in interest, reducing the cash required to service debt and improving the company’s working capital. DLM also advised on the restructuring of the company’s balance sheet by moving the operating assets into a new vehicle and eliminated the strain of depreciation charges.

Focus for 2020

DLM is in discussions with industry stakeholders and umbrella bodies to establish proprietary funding conduits across key sectors of the Nigerian economy. It intends to include microfinance, agriculture, education, health care and a continuation of other funding programmes for the mortgage, real estate and transportation sectors.

Working with a DFI partner, the company recently concluded the design of an aggregation vehicle aimed at providing local currency, wholesale funding solutions to micro-lenders in Nigeria by way of loan book securitisation.

A similar platform to provide financing to primary users of agriculture commodities is currently being developed.

Business

Workers’ Comp Benefits and the Going and Coming Rule

ByCFI.co Blogger

Traveling for work is a complex issue when it comes to your eligibility for workers’ compensation. The general rule is that workers’ compensation doesn’t cover your commute to and from work.

Does Workers’ Comp Cover Travel for Business?

Yes, workers’ comp covers travel for business. When you’re traveling because of your work, you can claim workers’ compensation in the event of an injury. The workers’ compensation system operates the same way whether you’re actively on the job or traveling for your employer.

Personal errands during work travel are not covered; however, the travel itself and incidental activities like the hotel and meals still fall under the workers’ compensation system. Workers’ compensation covers travel for business except for strictly personal activities during the trip.

Does Workers’ Comp Cover Travel to and From Work?

Workers’ comp does not cover travel to and from work. However, there may be situations when you are traveling related to work that are actually covered. Travel to and from work is generally not included. Still, if you are running errands for your employer or on a work-related travel assignment, you may actually be classified as working.

It depends on whether you’re serving the interests of your employer during the travel. Although the general rule is that workers’ comp does not include travel to and from work, there may be situations where your traveling counts as being on the job.

Workers’ Compensation and Travel

The purpose of workers’ compensation is to provide employees easy access to financial compensation when they’re hurt at work. The general rule is that you can claim workers’ compensation for work-related injuries. If you’re on the job and you get hurt, you can access the workers’ compensation system to pay for your medical bills and provide replacement income.

However, workers’ compensation doesn’t cover the risks of daily life. For that reason, the employee’s personal commute doesn’t fall under the workers’ compensation system. If you get hurt going to or from work, you have to look to your own car insurance or personal insurance to pay your expenses. You may also bring a third-party claim for financial compensation, but the person or entity that caused your injury is responsible for your damages, not your employer.

Traveling for Work

However, even if you’re traveling at the time of your injury, you’re not necessarily out of the workers’ compensation system. You may be traveling for work and not realize it. When you’re traveling on company business, you’re still covered by workers’ compensation.

Even things that are incidental to the travel itself, like staying at a hotel or eating meals while away from home, can classify you as working for the purposes of workers’ compensation. It’s essential to evaluate the entire circumstances present when the accident occurs.

Buma vs. Providence Corp. Development – Nevada Supreme Court

In the Buma v. Providence Corp. Development case, the Nevada Supreme Court recently clarified the rules when it comes to what counts as work-related travel. Nevada Revised Statutes 616C.150(1) states that a person must show their injury arises out of the course of employment. The court said that a person might be in the course of their employment even if they’re not directly on the route of travel at the time of the injury.

In the Buma v. Providence Corp. case, the victim was the vice president of sales for his company. He worked from home and made his own travel arrangements. The victim traveled out of state for a conference. He stayed at a ranch with a friend and affiliate of the company. Together, the two prepared joint presentations to give on behalf of the company. The victim died while riding an ATV on the ranch.

The third-party workers’ comp insurer, and the lower court, denied the victim’s family workers’ compensation benefits. They said that the accident did not arise out of work duties. However, the Nevada Supreme Court vacated the lower court’s decision.

When Does an Injury Arise out of the Course of Employment for Workers’ Compensation Purposes?

The Nevada Supreme Court said that an injury arises out of the scope of employment when there is a causal connection between the victim’s injury and the nature of the employee’s duties. Under Nevada Revised Statutes 616B.612(3), all travel that an employee gets paid for is part of the course of employment.

However, even if part of the travel isn’t compensated hourly, it may still be work-related travel. Generally, workers’ compensation covers business trips. It covers the actual business part of the trip, but it also includes staying in hotels, sleeping, eating, and other navigation that has to happen for the trip.

Does the “Coming and Going” Workers’ Compensation Rule Apply During Business Travel?

In the Buma case, the lower court applied the “going and coming” rule. The rule prohibits compensation for injuries that occur during the commute. The Supreme Court explained that the employer is not liable for the daily dangers of the employee; however, the commuting rule isn’t applicable when a person travels for work. Under Nevada law 616B.612(3), traveling employees are covered, including acts that are incidental to traveling.

The court said that work travel doesn’t cover social and recreational activities that a traveling employee chooses to pursue. These are things that occur for strictly personal amusement. To be a personal activity, the employee must show an intent to abandon the job temporarily. It’s a very fact-dependent question that depends on the unique situation in each case.

Conclusion

The workers’ compensation commuting rule is complicated. There are times that work travel is covered, and you are eligible for benefits. Sometimes it can be a difficult question of whether you’re traveling for business. The Las Vegas workers’ compensation attorneys at Adam S. Kutner, Attorney at Law explain travel, and the 2019 Nevada Supreme Court case of Buma vs. Providence Corp. Development.

The best way to know if you qualify for workers’ compensation is by getting a personal review of your claim by a qualified and experienced attorney.

Business

Half of UK & US firms predict a recession in 2020 and a third predict a global recession

ByCFI.co Blogger

Just under half of firms in the UK (46%) and US (45%) predict their country will go into recession in 2020, according to research by trade finance provider Stenn
The poll of over 700 senior executives at medium-large sized businesses across the UK, US and China, also revealed that well over a third (37%) of UK firms and one in three (35%) US firms expect to see a global recession or international global crisis in 2020
In the UK, a third (33%) of firms expect the economy to shrink in 2020, with well over a tenth (14%) expecting it to contract by 1-3%
- A further 6% expect the UK economy to stay flat with no growth
In the US, almost one in five (16%) expect the economy to shrink in 2020, most likely by 1-3% (7%)
- In addition, 6% also expect it to stay flat with no growth.

Dr. Kerstin Braun, President of Stenn Group, commented: “2019 was weaker than expected and the stakes are only higher for 2020. Governments around the world are having to act forcefully to prevent the economic hit from Covid-19 deepening, taking a coordinated approach and opening the liquidity pipe for both fiscal and monetary support.

While a low interest rate provides an important cut in borrowing costs for businesses and consumers at this delicate moment, the coronavirus outbreak will be a real test of the health of the UK and US economies. Lowering rates alone isn’t enough to be effective in offsetting the economic impact of Covid-19. We already know the Chinese economy is going to be hit in the first and second quarter.

“For us, the plunge in oil coupled with the economic damage of Covid-19 marked the beginning of a global recession. Our research showed that at the beginning of the year, half of UK and US businesses predicted a recession and a third predicted an international global crisis, and just three months into 2020 and we’re starting to see this play out.”

Methodology

The survey was conducted by Atomik Research among 706 senior decision makers at medium-large sized businesses, across the UK, US, and Chinese markets. The research fieldwork took place on the 18^th – 28^th November 2019. Atomik Research is an independent creative market research agency that employs MRS-certified researchers and abides to MRS code.

About Stenn

Stenn International Ltd. is a UK-based, non-bank trade finance provider specialising in cross-border trade. Stenn’s trade finance solutions are comprehensive and can be combined to cover the entire supply chain from purchase order to delivery of goods. Innovative practices allow Stenn to finance in sectors and geographic regions currently underserved in global trade. The company operates globally with offices in Buenos Aires, Los Angeles, Dallas, New York, Miami, London, Amsterdam, Dusseldorf, Berlin, Mumbai, Chennai, Singapore, Hong Kong, Guangzhou, Hangzhou, Suzhou, Shanghai and Qingdao.

Learn more at https://stenn.com or follow Twitter, LinkedIn and Facebook.

Business

Coronavirus: Is your business immune?

ByCFI.co Blogger

The outbreak of the coronavirus disease, COVID-19 continues to pose a significant threat to businesses in the UK. The impact on supply chains, transport and international travel is causing businesses to consider the impact of coronavirus on their current or future contractual agreements. Here Julie Hunter a commercial solicitor at Stephensons Solicitors LLP, discusses why it’s important for businesses to understand their legal rights and obligations in light of this global pandemic.

Coronavirus: Is your business immune? — **Julie Hunter**

The outbreak of the coronavirus disease COVID-19 continues to cause severe disruption and uncertainty to global trade. Now categorised as a global pandemic by the World Health Organisation, businesses must consider whether the impact of the coronavirus could cause them to default on their contractual obligations, whether this may be an inability to supply goods due to the effect on the supply chain, an inability to provide services due to travel restrictions or the cancellation of planned public events due to quarantine. Many larger businesses have already started to issue statements to their customers and suppliers in advance of any potential disruption caused by the outbreak.

Can your business delay performance or fail to fulfil its obligations under a commercial contract due to the coronavirus outbreak without facing liability? The often-standard force majeure clause contained in commercial contracts may mitigate risks and help parties navigate the difficulties caused by the outbreak.

What is Force Majeure?

A force majeure clause may relieve a party from performing its obligations under a commercial contract due to the occurrence of events which are unforeseeable or outside of its control. You can only rely on a force majeure clause if it has been drafted into your contract. A force majeure clause cannot be implied.

As force majeure has no defined meaning in English law, the effect of a force majeure clause will depend upon the way it has been drafted into each individual contract. Typically, force majeure clauses can cover:

acts of God, such as natural disasters and extreme weather events
terrorist attacks, civil war and breaking off diplomatic relations
compliance with a law or order, rule or direction of the government
embargos
epidemics or pandemics

Your force majeure clause may give you the right to suspend performance of the contract for a certain period of time or allow either you or your counterparty to terminate the contract entirely on the occurrence of a force majeure event.

COVID-19 as a Force Majeure

On 11 March 2020, the World Health Organisation classified the coronavirus as a global pandemic. If your force majeure clause covers the occurrence of a pandemic, then the coronavirus outbreak is likely to constitute a force majeure event.

If your force majeure clause does not cover pandemics, you must carefully consider whether the outbreak or its effects could fall into any of the other force majeure events specified in your contract. For example, you may find it possible to argue that the quarantine or isolation restrictions effecting your supply chain constitute a ‘work stoppage’, or that any international travel restrictions imposed in the UK and other countries which restrict performance could constitute ‘compliance with an order of a government’.

The court often interprets the precise wording of force majeure clauses strictly. If the situation is unclear, you should seek specialist legal advice on whether the coronavirus would constitute a force majeure event under your contract.

Invoking the clause

Even if the coronavirus qualifies as a force majeure event under your contract, you may not necessarily be able to invoke your rights under the force majeure clause.

Most force majeure clauses require you to demonstrate that the event itself has prevented performance of your contract. This means that if the coronavirus outbreak is simply causing performance to be more difficult, costly or time-consuming for your business, this may not necessarily be enough to invoke the clause.

Additionally, it may not always be desirable to invoke your force majeure clause for commercial reasons. You may need to consider the following matters:

Is the force majeure clause / event open to interpretation? Your counterparty may dispute your entitlement to any force majeure remedies and seek to enforce performance of the contract.
Could your insurance policy cover any losses or business interruption instead?
Will other parties / business be facing similar problems with supply or performance? Could you negotiate new terms to navigate the issues?
Would exercising the force majeure clause damage your ongoing relationship with the counterparty? Is there a reputational risk if the matter became public?

Breach of contract

It is possible that the effects of the outbreak on your business may not be covered by the force majeure clause as drafted or you may not have the option of relying on a force majeure contract at all.

If this is the case, any failure to perform your obligations under the contract (even if the failure is attributable to the coronavirus) may constitute a breach of contract which you could be liable to the counterparty for. However, there may be other mechanisms in the contract or under English contract law generally which may assist you and it is imperative to obtain legal advice should you find yourself in this situation.

Seeking a legal specialist

If you are currently considering entering into new contracts or are reviewing your contracts in light of the coronavirus, you should seek legal advice on strengthening your force majeure clause.

If you are currently facing threats of litigation over failed performance caused by the coronavirus or are considering invoking your force majeure clause, it is important to seek legal advice on your rights of termination and breach of contract.

About Stephensons

Stephensons Solicitors LLP is a full-service law firm with offices in Bolton, London, Manchester, St Helens and Wigan.

Business

Business owners urged to take six steps to limit coronavirus risk to their operations

ByCFI.co Blogger

AMID all the uncertainty caused by the coronavirus outbreak business owners may feel their fate isn’t in their own hands – but in fact there’s lots that they can do to help them take control.

Business owners urged to take six steps to limit coronavirus — David Tew

“These are uncertain times. No-one knows exactly how this is going to play out. But there are certain things you can do to protect your business,” said David Tew, a dispute resolution specialist with Cartmell Shepherd Solicitors.

“A bit like the advice across society about taking sensible steps such as washing your hands, there are steps you can take as a business to protect yourself,” said David.

Here David shares half a dozen simple steps aimed at helping you and your business to be prepared and to focus on what you can control.

1. Check your ongoing contracts

“Check your contracts. What are your obligations and your rights?

“Will coronavirus allow a contracting party to pull out of its obligations on an existing contract? It depends very much on what is the exact wording in the contract.

“In particular you should be checking is there a force majeure clause in your contracts which allows a party to suspend or terminate the performance of its obligations when certain circumstances beyond their control arise.

“If there is not a force majeure clause then it is possible to look at the legal doctrine of ‘frustration’ where it is impossible to complete a contract because of a change of circumstances outside your control. But this is open to different interpretations and may be difficult to rely on, highlighting the importance of ensuring that your contracts are fit for purpose.”

2. Check your insurance policies

“Have a close look at your business insurance policy to see if you have any business interruption coverage and check exactly what those terms are.”

3. Carry out a risk assessment

“Carry out a general risk assessment on all parts of your business to identify exactly what is at risk, and then focus on controlling those areas which are within your control.”

4. Take practical steps

“So far much of the focus has been on the international aspect of coronavirus. But that is set to move to a more domestic level and it is important as a business owner that you do everything you can now to make sure you, your employees, your supply chain and your clients are as prepared as possible.

“If we are moving towards a situation where the advice will be for more people to self-isolate, or if there are restrictions of movement, then there are practical steps that you can take now to mitigate those risks.

“If you want to move to more remote working, then check the practical issues that will involve. Do the business processes and procedures work remotely? Check employee policies – do they cover working from home? Is it practical for all employees to work from home? Do they have a safe environment to work in?

“Review your supply chain. Have a discussion with those in your supply chain and discuss action plans with them.”

5. Keep communicating

“It is really important to keep communication channels open between you, your employees, your clients and your supply chain. Keep talking and discussing how you can support each other. Follow any guidance online https://www.gov.uk/guidance/coronavirus-covid-19-information-for-the-public

“Identify ways you can work together. There will be cases where because of the way a contract has been worded, it is within your legal right to ensure that those obligations are met. But that might not be the best approach when it comes to long-term business relationships.

“You are likely to want those relationships to be positive in the long term. And while the temptation might be to jump on the specific wording in a contract, remember that your clients and customers will still be here long after this situation has come and gone. How you act now, is likely to affect those business relationships in the future.

“By showing flexibility and understanding and being willing to restructure that arrangement in the short term, is likely to be of benefit in the long term.”

6. Ensure you have good legal advice

“A good solicitor will help you with your concerns and give you the advice on how you can best protect your business. We have a six-strong team in dispute resolution at Cartmell Shepherd led by director Mark Aspin. If you are unsure about anything it is always best to ask.”

Business

Chancellor Must Use Budget to Give Family Businesses Confidence to Invest in the Future – Starting with Maintaining BPR

ByCFI.co Blogger

The Institute for Family Business (IFB) is calling on the Chancellor to use his Budget on Wednesday to create an environment that gives family businesses the confidence to invest in future growth.

Reports that the Chancellor intends to review the Business Property Relief (BPR) in the upcoming Budget, are deeply concerning to the UK’s family run businesses. Family businesses employ over 13 million people and generate 28% of the UK’s GDP. Family firms continue to exist for generation after generation by innovating, adapting and looking for new markets and opportunities. They make investment decisions for the long term.

Every year 85,000 family SMEs are expected to transfer ownership of their businesses to the next generation. Removing BPR would force family run firms to pay a tax penalty on transfer, which others don’t have to.

Fiona Graham from the Institute for Family Business said:

“Family firms are the driving force across all regions, communities and sectors of the UK. Well over 80% of businesses in Yorkshire, the North West and the East and West Midlands are family owned. In those four regions alone family firms employ nearly four and a half million people.

“Inheritance tax relief is essential to their future prosperity. Scrapping it would have a catastrophic impact on family firms. It would lead to family run businesses being sold or broken up to pay an Inheritance Tax bill, with knock on effects on employment. It will also damage confidence in the sector, where families would reduce investment and always plan for the worst.

“The introduction of BPR positively impacted the health of family businesses and the wider economy by giving business owners the confidence to invest and expand.

“The majority of British businesses are family businesses. They are dependent upon BPR for their current and future prosperity. Any change to it would inevitably result in a decline in growth and investment coupled with stagnation in the number of new jobs being created.

“As the UK seeks to level up nationally in the coming years, the success of family businesses will be a crucial factor in doing so. In order to succeed and grow, they require a stable tax system and an economic environment. The future of the family business sector – and ultimately the Government’s ambitions for regional growth and investment – rely on maintaining BPR.”

The Institute for Family Business is the UK’s family business organisation, supporting and promoting the UK family-owned business sector through events, networking, representation, and thought leadership.

Two-thirds of British businesses are family businesses – ranging from multinational, multibillion-pound businesses to micro start-ups, the sector employs over 13 million people and contributes £182 billion in taxes.

Lifestyle

Amos Rex in Helsinki awarded New Cultural Destination of the Year in Europe at LCD Berlin Awards

ByCFI.co Blogger

The Amos Rex Art Museum in Helsinki has won the prestigious LCD (Leading Culture Destination) Award for New Cultural Destination of the Year – Europe. The awards, coined “the Oscars for Museums” by the international press, were presented at the annual LCD awards ceremony in Berlin on 4 March 2020.

Amos Rex in Helsinki awarded New Cultural Destination of the Year in Europe at LCD Berlin Awards

Since opening in August 2018, the Amos Rex Art Museum has made a big impact on the cultural scene in Helsinki, attracting over half a million visitors during its first year. Amos Rex is an art museum where the past, present and future meet. The iconic functionalist Lasipalatsi building (i.e. Glass Palace) and the new gallery spaces under its undulating square, provide 10 000 m² for unique experiences both below and above ground, as well as on the silver screen of Bio Rex. Amos Rex’s exhibition programme extends from the newest, often experimental, contemporary art to 20th-century modernism and ancient cultures. The new museum space was designed by Finnish architecture office JKMM.

“We are extremely honoured at Amos Rex to receive the LCD Award for New Cultural Destination of the Year in Europe. It is a significant award for us, as we aim to serve the international public as an art museum, architectural attraction and urban meeting place. We are delighted to see how Amos Rex is contributing to Helsinki’s appeal as a cultural city in Europe”, says Kai Kartio, Museum Director of Amos Rex.

Helsinki – a thriving city of arts and culture

Feeding its lively cultural scene, Helsinki continues to position the culture amongst its core values, building on its reputation as an art, design and architecture capital. With residents visiting cultural institutions more than ever before, ambitious initiatives such as the 2018 Amos Rex Art Museum and Oodi Central Library openings demonstrate the city’s forward-looking commitment to creativity.

Championing local contemporary art and its relationship with the global community, the eagerly anticipated Helsinki Biennial 2020 draws on Helsinki’s distinct characteristics and the surrounding archipelago, offering a unique contribution to the international art scene.

“Helsinki believes in culture. The city is a diversified and internationally attractive city of arts and culture, with Amos Rex as one of the leading attractions. Working together with cultural institutions such as Amos Rex, the new central library Oodi and the upcoming international art event Helsinki Biennial, we are further strengthening Helsinki’s position as a must-visit city of culture”, continues Laura Aalto, CEO of Helsinki Marketing.

For more information, please contact:

Amos Rex
Iia Palovaara, Communications Officer
+358 50 544 3331
iia.palovaara@amosrex.fi

Helsinki Marketing
Laura Aalto, CEO
+358 40 507 9660
laura.aalto@hel.fi

Helsinki Marketing is a company owned by the City of Helsinki. It is responsible for operative city marketing and business partnerships for Helsinki. Helsinki Marketing interacts with local residents, visitors, decision-makers and experts.

Corporate Finance

European FinTech Lending Industry to Hit $9.6bn Value This Year

ByCFI.co Blogger

Innovative lending services, such as crowd and P2P marketplace loans, are becoming increasingly popular in many European countries. With the development of financial technology, recent years have witnessed a growing number of business customers and private borrowers using these digital financial services.

According to data gathered by Finanso.se, the European fintech, or the alternative loans industry, is expected to hit a $9.6bn transaction value this year, growing by 10% year-on-year.

Crowdlending Generates Nearly 70% of Total Market Transaction Value

After the financial crisis, many traditional banks became very restrictive in approving loans, especially in some European countries, leaving businesses and individual consumers with no access to much-needed cash. This created space for lending platforms, which connected borrowers directly to lenders, and removed the banks from the equation.

Lending platforms use sophisticated computer algorithms to make lending decisions, provide fast loans, and lower rates to borrowers. Investors, on the other hand, are given the ability to easily invest in loans outside of their countries at attractive returns.

In 2017, the European fintech lending market hit $6.3bn value, revealed the Statista Alternative Lending Market Outlook. By the end of 2018, the market value increased by 20% and reached $7.5bn worth. The rising trend continued in the next twelve months with the entire market reaching $8.7bn value. The statistics indicate European fintech lending industry is expected to show an annual growth rate of 3.0% between 2020 and 2023, resulting in $10.5bn transaction value in the next three years.

The market’s largest segment is crowdlending or peer-to-peer business lending. In 2017, European peer-to-peer loans in the business sector reached $3.6bn worth. Over the last three years, the market value of the crowdlending loans increased by more than 75% and hit $6.5bn transaction value in 2020. Statistics show this amount will grow to nearly $7.2bn in the next three years.

Consumer peer-to-peer loans are forecast to edge up to $3.1bn value in 2020, twice less than business lending.

Number of European Fintech Loans to Reach 1.3 Million by 2023

Although peer-to-peer business loans represent the leading market segment, the statistics indicate a much higher number of consumer peer-to-peer loans in Europe. In 2017, there were more than 911,000 successfully funded alternative loans in the consumer segment.

Business peer-to-peer loans reached over 63,000, or 14 times less compared to consumer loans. In the last three years, consumer and business alternative loans rose to 1 million and 75,900, respectively. The average funding per loan in the crowdlending segment is expected to reach $86,185 this year. Statista survey indicates the total number of European fintech loans will amount to over 1.3 million by 2023.

Compared by geography, the United Kingdom represents the leading European fintech lending market, and the third-largest fintech lending market globally. According to statistics, the total value of UK fintech loans is expected to peak at a value of $4.8bn this year.

Switzerland ranked as the second-largest market in Europe with $1.4bn worth transactions in 2020, growing by remarkable 27.4% year-on-year. With a $796 million transaction value in 2020, Italy ranked as the third-largest fintech lending market in Europe.

However, besides Switzerland, Denmark and Spain are expected to see the highest growth rates in the following years, rising by 23.7% and 22.9% respectively year-on-year.

Read the full story here: https://finanso.se/european-fintech-lending-industry-to-hit-9-6bn-value-this-year/

Finance

What’s the secret to trading on the financial markets?

ByCFI.co Blogger

Giles Coghlan, chief currency analyst at HYCM

There are countless books claiming to elucidate exactingly how to invest over the long-term. However, ask any seasoned trader what the secret is to an effective investment strategy and you’ll quickly find there is no one tactic or panacea for consistent growth.

Instead, what most traders rely on is an informed and reactive understanding of both current affairs and unfolding market trends to help inform their investment decisions. By letting this understanding dynamically inform one’s portfolio, they are able to confidently react to sudden market shocks.

Investors must therefore have one eye on the present and one eye on the future, and understand how different social, political, geographical and economic events could impact their portfolio. This understanding must be informed by an awareness of how past events have affected the prices of different assets. Thankfully, there are plenty of useful ways that investors can prep for the future.

Markets are all about cause and effect

The fundamental operation of the financial market is one of cause and effect; one event or price movement will inevitably affect the prices of other assets. Whilst this is a simple enough concept, big political and social events often trigger a multiplicity of effects, which can in turn impact on one another.

For example, the recent outbreak of coronavirus is having a major impact on global supply chains; China’s productivity has been negatively affected, which has had a flow-on effect on major businesses that rely on China as part of its supply chain.

In terms of market volatility, there is a huge amount of historical evidence which shows how the coronavirus could impact asset prices. One central theme is likely to be the increase of value in ‘hard commodities’ — physical investments like gold, steel and oil. That is because these so-called safe haven assets are perceived as having global appeal and consistent demand, and therefore offer greater resilience in times of volatile trading conditions.

Never overlook the advantages of an informed strategy

I doubt you could find many long-term traders who have not woken up one morning to see that there has been a dip in the value of their investments as a result of an unforeseen geopolitical event. For those who find themselves in this situation, it can be easy to panic and make uninformed decisions. This is the entirely wrong approach to take.

By its very nature, finance is an unpredictable sphere of work, and unexpected shocks are par for the course. That’s why the strongest financial plans tend to include or account for the unforeseen. When prices dip or there is a sudden market shock, it has been for the most past accounted for and leaves little room for sudden trades that are informed by the heart, not the mind.

Remember to diversify (within limit)

Another way of managing market volatility is ensuring your portfolio is diverse, with investments spread across multiple markets. Doing so reduces your portfolio’s risk of suffering significant loses should one particular market or sector be adversely affected by an unexpected event. However, the key to diversification is not to cast your net too wide.

The broad points that need internalising here can be surmised very briefly: knowledge is power.

Mastering the complex nature of different financial markets is not simply about watching the fluctuating prices of assets. It’s also about understanding the historical performance of different markets, analysing previous trends and using all this as a guide to manage your investments during sudden political and economic shocks.

What’s more, any investment decision or trade needs to be part of a bigger strategy with goals, returns and risk exposure all clearly defined. Doing this ensures that investors and traders are in the position to stay on top of their financial portfolio.

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Giles Coghlan is Chief Currency Analyst at HYCM – an online provider of forex and Contracts for Difference (CFDs) trading services for both retail and institutional traders. HYCM is regulated by the internationally recognized financial regulator FCA. HYCM is backed by the Henyep Capital Markets Group established in 1977 with investments in property, financial services, charity, and education. The Group via its relevant subsidiaries have representations in Hong Kong, United Kingdom, Dubai, and Cyprus.