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Showing posts from November, 2021

How Exactly Do Most Hedge Funds Make Money?

  Hedge funds   earn from the fees they take from their investors for managing their money and also from the massive returns they generate by investing in various financial tools that are not readily accessible to the general public. Though the fees charged differs from one hedge fund to another, the strategies used to invest and generate returns are somewhat similar. To give you more clarity on this topic, here are 4 strategies that hedge funds commonly use to make money and generate massive returns for their investors and themselves - The bull and bear strategy - The hedge funds that use this strategy usually believe in being the bulls or bears of a trade. This means they would buy a position in the financial market if they see a particular asset having the potential to rise and similarly, open a sell position if they find an asset that is dropping in value. This is also applicable in the derivatives market with the help of a call or put option; these are essentially contracts that g

What Are Unicorn Startups And How Can One Invest In Them?

Unicorn startups, if chosen right, are multi-baggers. However, the risk is relatively high. Fast-growing startups are called ‘unicorns’ because they are too good to be true and very rare to find just like the mythical creatures. This, however, was the situation of the past; in today's times finding a unicorn startup is not that difficult. In fact, in 2020, there were around 500 of them globally! Unicorn startups are a quintessential part of a high profit yielding investment portfolio and if you are interested in them, here’s everything you need to know before you start out- A brief understanding of unicorn startups - Any startup that reaches a billion dollars valuation before going public is called a U nicorn Startup . These private ventures achieve this quotation by making sales and capitalizing on a significant piece of their target market. Even the startups that have not yet grown that huge but have an innovative product or business model and offer a very promising potential of

Here’s everything you need to know about private equity funds

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  As an investor wanting higher returns, you would always want to diversify your investment portfolio. One of the best ways to do that is through the private equity market. Private equities are essentially the shares of a private company; you would not find them listed in any public indices and investing in them is quite different from getting involved with public market shares. To know more, read on – What exactly are private equity funds?   Private equity funds  are nothing but the capital that the fund managers use to invest in private companies that they analyze and conclude to have a very good potential to grow in the coming future. A few examples of private equity funds are shares of a unicorn startup, a highly profitable private company, buyout funds, growth equity funds, and venture capital funds. To maximize the return on investment, fund managers use various different strategies that have different profit potentials and risks. However, each of these is designed for only one t

What is a security token and how do they work?

  Security tokens are just another name for D igital Securities . They have completely changed the way people invest and as a result, it has become very important for an investor, even if they are just starting out, to understand what are digital securities and how they are extremely helpful. If you are curious about security tokens, I’ve got the perfect answer for you, read on - What exactly are digital securities? These are digitalized forms of financial securities like stocks, bonds, funds, and other similar assets. They are built on blockchain technology and are highly liquid and provide increased accessibility to the various retail investors that are present in the market today. To give you more clarity, if you bought a stock, for example, in the older days, you would get a physical certificate stating the same. However, with the help of digital securities, buying equities is now paperless and requires fewer steps to buy and sell the different available securities. How do they wor

A Beginner’s Guide To Security Tokens

You might not understand many financial terms when you are just starting your journey as an investor. However, that is okay as everybody has to start somewhere. If you have come across the terms ‘security tokens’ or ‘digital securities’ while researching the different ways to invest and have a mind full of questions regarding them, you’ve come to the right place. To give you more clarity on this topic without further ado, here’s everything you need to know about security tokens - What exactly are security tokens? Digital securities   are just another name for  security tokens . These are financial securities that are present in the digital format and have a blockchain-based structure. This enables them to offer investors more liquidity and accessibility to the various investment options like stocks, funds, bonds, and other similar assets. Investing in security tokens is regulated in the majority of countries. ADDX is one such platform where investors can buy/sell digital securities   a

What is the difference between a private equity firm and a venture capital firm?

Private equity is a broader term that is used to define financial assets like  unicorn private equity , shares of established private companies, and other such investment tools that are not listed in the public domain. To give you more clarity on this topic and to help you distinguish between the two terms better, not all private equities are a form of venture capital equities but all venture capital equities are definitely a form of private equities. To help show you the similarity, here are 3 features of a good private equity investment that are also applicable to venture capital equities but not vice versa necessarily - 1) Their management is highly skilled Leadership is one of the most important aspects to assess when evaluating the growth potential of a startup. New companies that become successful are led by visionaries who are highly skilled managers and possess a sound technical knowledge of their respective industries. The most important skill you need to look at when evaluati

How does an investor evaluate a private equity investment?

  Private equity is a completely different financial asset and serves unidentical financial goals when compared to the expectations one might have when putting their money in public corporations. I have a fair share of knowledge about this topic and I have acquired it from my study of the Singaporean markets. You too can learn in detail about this by searching ‘ private equity investment Singapore ’ on google To help you understand how an investor evaluates a private equity investment opportunity, here are 2 things that an investor looks for to make the right private equity investments to enhance their portfolio - Gauge the growth potential - Any type of corporation that wants to survive in the market for the long run, has to make sure they have multiple avenues of expansion and are not limited to only one field of operation. A few examples of growth drivers can be an improvised upselling strategy, territorial expansion, exploring new industries, or future acquisitions and mergers. As

A Beginner’s Guide To Security Tokens

  You might not understand many financial terms when you are just starting your journey as an investor. However, that is okay as everybody has to start somewhere. If you have come across the terms ‘ security tokens’   or ‘digital securities’ while researching the different ways to invest and have a mind full of questions regarding them, you’ve come to the right place. To give you more clarity on this topic without further ado, here’s everything you need to know about security tokens - What exactly are security tokens? Digital securities   are just another name for  security tokens . These are financial securities that are present in the digital format and have a blockchain-based structure. This enables them to offer investors more liquidity and accessibility to the various investment options like stocks, funds, bonds, and other similar assets. Investing in security tokens is regulated in the majority of countries. ADDX is one such platform where investors can buy/sell digital securiti