He released this service in 2012 for US-based traders. It has developed exclusive financial products known as “motifs.” These are similar to low-cost theme-based ETF (exchange-traded fund) offered by start-ups like WEALTHFRONT.
Role of Motif Investing in Financial Investments
Holding baskets of costly stocks indicates more instability and horrible losses. In such scenario, Motif investing works as a blessing. How? It provides the flexibility to the investors. They can decide on areas that they would like to invest in. Not just that, the investors do not have to make expensive individual stock purchases to be in the game.
Today the sharemarket has become a favourite place for millions of investors. If the investment is done carefully, it can give massive returns to the traders. The returns from the potentially strong stocks are really huge compared to any other asset class. However, one small mistake can put a big dent in their capital. Online robot advisers stepped in to prevent such damages.
With the initiation of online trading, ideas like online brokerage have strolled in. Motif Investing is one of the distinctive names in the aforementioned field. It is discount brokerage that makes investing and trading in the stock market easier for the individual stock investors. With a proper guidance, they can buy or sell stocks by themselves with just a click of the mouse.
The Salient features
Earning from the stocks is no longer a hassle. Anyone can invest while sitting in the comfort of their home or office. Motif Investing helps the traders invest based on themes. It is similar to constructing a mini-ETF. In short, motifs proffer extensive, low-risk investments.
According to Walia motif investing can be defined as a combination of Peter Lynch’s investment know-how with Jack Bogle’s diversification. The investor invests in groups of investments that have the same kind of characteristics. Motif Investing allows traders to create or buy motifs featuring between 20 to 30 stocks or ETFs following definite themes. “Biotech Breakthroughs” “Healthy and Tasty,” “Utility Bills,” and “Recession Resistant” are a few examples.
Motif Investing is a fascinating investment platform. It systematically merges the roles of an online stockbroker and portfolio executive and puts them together with idea generation and thematic modelling. Investors have the power to adjust the weight of stocks within a motif until they reach their required portfolio.
Simply by depositing a nominal charge, anyone can open an account online. The company charges a fixed commission per motif purchase. If desired, traders can add stocks or ETFs to their already bought motif.
The benefits of Motif Investing
Motif Investing is gaining popularity due to its nominal fee. Here traders have to pay one-time commission amount while purchasing a motif. No additional charges are attached to Motif’s service. With the increasing demand of robo-advisors, there is a cutthroat competition among the online brokerage houses. Since Motif Investing follows most avant-garde of investing, traders with little capital may find it profitable.
The drawbacks of Motif Investing
Financial investments are volatile in nature. There are a lot of risks involved in the whole process. Motif Investing is no exception. To get profits, investors must be aware of well-planned tactics for buying and selling stocks before investing. Short-term investors are the most affected ones here. Mostly they earn little to no returns on their investments.
Returns earned from stocks or ETFs are not subject to reinvestment. Motif disburses dividends as cash flow. Plus reinvesting must be done manually which demands an additional transaction fee. Similarly, investors must shell out a trading fee while changing securities within a motif.
Not company earnings, not data but vaccines now steering investor sentiment
By Marc Jones and Dhara Ranasinghe
LONDON (Reuters) – Forget economic data releases and corporate trading statements — vaccine rollout progress is what fund managers and analysts are watching to gauge which markets may recover quickest from the COVID-19 devastation and to guide their investment decisions.
Consensus is for world economic growth to rebound this year above 5%, while Refinitiv I/B/E/S forecasts that 2021 earnings will expand 38% and 21% in Europe and the United States respectively.
Yet those projections and investment themes hinge almost entirely on how quickly inoculation campaigns progress; new COVID-19 strains and fresh lockdown extensions make official data releases and company profit-loss statements hopelessly out of date for anyone who uses them to guide investment decisions.
“The vaccine race remains the major wild card here. It will shape the outlook and perceptions of global growth leadership in 2021,” said Mark McCormick, head of currency strategy at TD Securities.
“While vaccines could reinforce a more synchronized recovery in the second half (2021), the early numbers reinforce the shifting fundamental between the United States, euro zone and others.”
The question is which country will be first to vaccinate 60%-70% of its population — the threshold generally seen as conferring herd immunity, where factories, bars and hotels can safely reopen. Delays could necessitate more stimulus from governments and central banks.
Patchy vaccine progress has forced some to push back initial estimates of when herd immunity could be reached. Deutsche Bank says late autumn is now more realistic than summer, though it expects the northern hemisphere spring to be a turning point, with 20%-25% of people vaccinated and restrictions slowly being lifted.
But race winners are already becoming evident, above all Israel, where a speedy immunisation campaign has brought a torrent of investment into its markets and pushed the shekel to quarter-century highs.
(Graphic: Vaccinations per 100 people by country, https://fingfx.thomsonreuters.com/gfx/mkt/azgvolalapd/Pasted%20image%201611247476583.png)
SHOT IN THE ARM
Others such as South Africa and Brazil, slower to get off the ground, have been punished by markets.
Britain’s pound meanwhile is at eight-month highs versus the euro which analysts attribute partly to better vaccination prospects; about 5 million people have had their first shot with numbers doubling in the past week.
Shamik Dhar, chief economist at BNY Mellon Investment Management expects double-digit GDP bouncebacks in Britain and the United States but noted sluggish euro zone progress.
“It is harder in the euro zone, the outlook is a bit more cloudy there as it looks like it will take longer to get herd immunity (due to slower vaccine programmes),” he added.
The euro bloc currently lags the likes of Britain and Israel in terms of per capita coverage, leading Germany to extend a hard lockdown until Feb. 14, while France and Netherlands are moving to impose night-time curfews.
Jack Allen-Reynolds, senior European economist at Capital Economics, said the slow vaccine progress and lockdowns had led him to revise down his euro zone 2021 GDP forecasts by a whole percentage point to 4%.
“We assume GDP gets back to pre-pandemic levels around 2022…the general story is that we think the euro zone will recover more slowly than US and UK.”
The United States, which started vaccinating its population last month, is also ahead of most other major economies with its vaccination rollout running at a rate of about 5 per 100.
Deutsche said at current rates 70 million Americans would have been immunised around April, the threshold for protecting the most vulnerable.
Some such as Eric Baurmeister, head of emerging markets fixed income at Morgan Stanley Investment Management, highlight risks to the vaccine trade, noting that markets appear to have more or less priced normality being restored, leaving room for disappointment.
Broadly though the view is that eventually consumers will channel pent-up savings into travel, shopping and entertainment, against a backdrop of abundant stimulus. In the meantime, investors are just trying to capture market moves when lockdowns are eased, said Hans Peterson global head of asset allocation at SEB Investment Management.
“All (market) moves depend now on the lower pace of infections,” Peterson said. “If that reverts, we have to go back to investing in the FAANGS (U.S. tech stocks) for good or for bad.”
(GRAPHIC: Renewed surge in COVID-19 across Europe – https://fingfx.thomsonreuters.com/gfx/mkt/xegvbejqwpq/COVID2101.PNG)
(Reporting by Dhara Ranasinghe and Marc Jones; Additional reporting by Karin Strohecker; Writing by Sujata Rao; Editing by Hugh Lawson)
BlackRock to add bitcoin as eligible investment to two funds
By David Randall
(Reuters) – BlackRock Inc, the world’s largest asset manager, is adding bitcoin futures as an eligible investment to two funds, a company filing showed.
The company said it could use bitcoin derivatives for its funds BlackRock Strategic Income Opportunities and BlackRock Global Allocation Fund Inc.
The funds will invest only in cash-settled bitcoin futures traded on commodity exchanges registered with the Commodity Futures Trading Commission, the company said in a filing to the Securities and Exchange Commission on Wednesday.
A BlackRock representative declined to comment beyond the filings when contacted by Reuters.
Earlier this month, Bitcoin, the world’s most popular cryptocurrency, hit a record high of $40,000, rallying more than 900% from a low in March and having only just breached $20,000 in mid-December.
Bitcoin tumbled 10.6% in midday U.S. trading Thursday.
Other U.S.-based asset managers will likely follow BlackRock’s lead and add exposure to bitcoin in some form to their go-anywhere or macro strategies as the cryptocurrency market becomes more liquid and developed, said Todd Rosenbluth, director of mutual fund research at CFRA.
“It’s easy to see how strong the performance has been of late and look at a historical asset allocation strategy that would have included a slice of crypto and how returns would have been enhanced as a result,” he said. “Large institutional investors are going to be able to tap into the futures market in a way that a retail investor could not do.”
There is currently no U.S.-based exchange-traded fund that owns bitcoin, limiting the ability of most fund managers to own the cryptocurrency in their portfolios.
BlackRock Chief Executive Officer Larry Fink had said at the Council of Foreign Relations in December that bitcoin is seeing giant moves every day and could possibly evolve into a global market. (https://bit.ly/2XXFHrB)
(Reporting by David Randall; Additional reporting by Radhika Anilkumar and Bhargav Acharya in Bengaluru; Editing by Arun Koyyur and Lisa Shumaker)
Bitcoin slumps 10% as pullback from record continues
LONDON (Reuters) – Bitcoin slumped 10% on Thursday to a 10-day low of $31,977 as the world’s most popular cryptocurrency continued to retreat from the $42,000 record high hit on Jan. 8.
The pullback came amid growing concerns that bitcoin is one of a number of financial bubbles threatening the overall stability of global markets.
Fears that U.S. President Joe Biden’s administration could attempt to regulate cryptocurrencies have also weighed, traders said.
(Reporting by Julien Ponthus; editing by Tom Wilson)
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