The Business of Business

Discussion in 'Chit Chat' started by expiated, May 24, 2020.

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    #41     Dec 16, 2023
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    #42     Dec 19, 2023
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    #43     Jan 11, 2024
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    Navigating the Forex Market:

    It is very possible that there is a significant segment of speculative traders in the Forex market—be they traders at a bank, a hedge fund, a proprietary trading firm, or just the collective actions of many speculative traders who don’t know each other—who are interpreting charts and acting in the same way, placing large orders that move the market in a certain direction.

    For example, this might be done in order to trigger stop-orders that are clustered at a certain level. So, if all these market participants see a recent price top, and they think there are stop-loss orders placed just above this top, then there may be a desire in the market to take out those stops, which would first require buying at market with large size.

    This means that the participants would end up with long positions, while also driving price up. Then when the market price reaches the stop-loss orders, these are triggered and drive the price up even farther.

    In this last burst of price moving up, the speculators are selling, exiting their long positions at a profit. The market participants that were previously short and had their stop-loss orders above that level are now left without their previous short positions in a market that is not really going up, but more likely to move down again.

    Now, even though "everyone" spots these levels, they will probably all have different opinions on what price will do in relation to them, and they all have their own agendas and needs.

    For example, say EURUSD is in an uptrend and currently at 1.1980, with an untouched 1.2000 above.

    Market Participant A believes this level (1.2000) will hold as resistance and price will move down from there, so Market Participant A sells at 1.1980 with a stop loss at 1.2020.

    Market Participant B believes this level will break, and that when it does, price will spike up sharply because all the people with short positions will have placed their stop losses just above 1.2000, and when they are triggered, the buying pressure will drive price up. So Market Participant B buys some now, and places a stop loss at 1.1960

    Market participant C is the Galactic Bank of Mars, and has sold binary options to Spaceship Manufacturer XYZ which wants to protect its export income from unfavorable currency movement. The options contract states that if EURUSD moves above 1.2000 before 5:00 PM, then the Galactic Bank of Mars will have to pay Spaceship Manufacturer XYZ a truck load of money.

    The proprietary trading desk of the Galactic Bank of Mars is now worried that this will happen, and they estimate it will cost them less to hold price below 1.2000 for a few hours rather than pay the options if price climbs above 1.2000. So, the head trader of the desk tells the guy handling EURUSD that day that he has a budget of X amount of money to spend on holding the EURUSD down by keeping his ask price below 1.1998.

    On the other hand, Oil Company ABC is looking to buy a large amount of EURUSD. They are aware that their buy orders would move price a lot higher, way above 1.2000, giving them a worse average price. Their treasury guy speaks to their bank's sales trader, and together they decide that the best strategy is to place limit buy orders a little at a time continuously during the London session priced at 1.1970-1.1980, benefiting from the resistance at 1.2000.

    These four Forex market participants will now place orders together with everyone else that has an opinion on EURUSD or that needs to pay for export/import, and their collective orders will determine if the level holds or not. This is like a "tug of war" between sell orders and buy orders.

    At some point, the EURUSD guy on the Galactic Bank of Mars desk sells all he has in budget X to protect the level, and the buyers manage to press the rate above 1.2000. At this stage the Galactic Bank of Mars guy is massively short and wants to get out of at least some of that short position, so he buys.

    At the same time, all the stop loss orders from everyone else who is short are triggered, plus a bunch of speculators are rushing in to buy, anticipating an up move. Of course, sometimes such levels hold, and sometimes they do not.

    Now, supposing a given speculator is better than most others at determining what levels will hold, for how long, and how many pips price will bounce before coming back to break the level; then that trader should profit handsomely. Nonetheless, these levels are there for everyone to see. It's just that everyone acts differently in response to them.
     
    #44     Jan 20, 2024
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    Chat GPT

    What are advisory shares in the world of business investment?

    Advisory shares, also known as advisory equity or advisor shares, refer to equity ownership granted to individuals who provide valuable advice, guidance, or strategic input to a business or startup. These individuals are typically experienced professionals, industry experts, or seasoned entrepreneurs who offer their expertise to help the company grow and succeed.

    Here are some key points about advisory shares:
    1. Equity Compensation: Instead of providing cash compensation, companies may offer advisory shares as a form of equity compensation to advisors. This aligns the interests of the advisors with those of the company, as they have a stake in the company's success.

    2. Vesting Period: Advisory shares often come with a vesting schedule, meaning that the advisor earns ownership rights gradually over time. This encourages the advisor to stay engaged and committed to the company's long-term success.

    3. Advisory Agreements: Before receiving advisory shares, advisors typically enter into advisory agreements with the company. These agreements outline the scope of the advisor's role, the duration of the advisory relationship, and the terms of the equity compensation.

    4. Role of Advisors: Advisors may contribute to various aspects of the business, including strategic planning, market analysis, business development, fundraising, and networking. Their insights and connections can be particularly valuable for startups and small businesses.

    5. Common in Startups: Advisory shares are commonly used in the startup ecosystem where cash resources may be limited, and the founders seek to leverage the expertise of experienced individuals to help drive the company's growth.

    6. Risk and Reward: Advisors take on some risk by tying their compensation to the success of the company. If the business performs well and the value of the equity increases, advisors stand to gain. However, if the company struggles or fails, the value of their advisory shares may decrease or become worthless.
    It's essential for both the company and the advisor to carefully negotiate and document the terms of the advisory relationship, including the percentage of equity offered, the vesting schedule, and the specific expectations regarding the advisor's contributions. Legal counsel is often involved in drafting these agreements to ensure clarity and protection for all parties involved.


    Bing.com

    Advisory shares, also known as "advisor shares," are a type of stock given to company advisors instead of employees. Start-up companies most often use them as an alternative compensation since they typically lack the necessary cash flow to adequately compensate these advisors.
     
    #45     Feb 9, 2024
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    Build-A-Bear and the makers of Squishmallows are facing off in federal court. Kelly Toys and its Berkshire Hathaway-controlled parent company Jazwares have sued Build-A-Bear, saying its new "Skoosherz" toys copy the look and feel of their mega-popular Squishmallows products.

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    #46     Feb 15, 2024
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    #47     Feb 26, 2024
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    Why have so many companies reached a billion dollars in net worth after 2017, but not before 2018?

    bing.com | Copilot

    The surge in companies reaching billion-dollar net worth after 2017 can be attributed to several factors:
    1. Technological Advancements: The rapid advancement of technology has fueled the growth of tech companies. Innovations in cloud computing, artificial intelligence, and e-commerce have led to substantial revenue increases for companies like Amazon and Microsoft.
    2. Profitability Shifts: Some companies experienced significant profit growth during this period. For instance, Amazon saw its net income balloon from $197 million in the second quarter of 2017 to $2.5 billion in the same quarter of 2018. Similarly, Epic Games, the creator of Fortnite, reported a $3 billion profit in 2018, contributing to its valuation of $15 billion.
    3. Market Capitalization: Companies like Apple, Microsoft, and Saudi Aramco achieved trillion-dollar market capitalizations, reflecting investor confidence and robust financial performance. Market cap is a key indicator of a company's overall value.
    4. Global Economic Trends: The global economy rebounded after the 2008 financial crisis, leading to increased business activity and higher valuations. Companies capitalized on this economic upswing.
    5. Industry-Specific Factors: Certain sectors, such as technology, healthcare, and energy, witnessed substantial growth. For example, Tesla became a major player in the electric vehicle market, contributing to its rise in net worth.
    6. Strategic Investments and Mergers: Companies strategically invested in acquisitions and mergers, expanding their reach and revenue streams. These moves often propelled them into the billion-dollar club.
    In summary, a combination of technological breakthroughs, profit surges, and favorable economic conditions contributed to the rise of billion-dollar companies after 2017. The landscape of corporate wealth continues to evolve, driven by innovation and market dynamics.
     
    #48     Feb 26, 2024
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    Who were the two people who independently invented the first version of the optical mouse?

    Two American computer scientists—Richard F. Lyon and Steven Todd Kirsch—independently developed the first of these optical hardware devices in 1980, using a single-pixel sensor.

    Both of them applied for patents on their schemes in mid-1981, and each of them received two U.S. patents (now expired).

    How much is Steve Kirsch worth?

    In 2007, Kirsch, a serial entrepreneur who has started seven companies (Mouse Systems, Frame Technology Corporation, Infoseek, Propel, Abaca, OneID and Token) had an estimated fortune of $230 million, the majority earned from the IPO of Infoseek and the acquisition of Frame Technology. (There is no specific information available regarding the net worth of Richard Lyon.)
     
    #49     Mar 6, 2024
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    #50     Mar 28, 2024