A zero-sum game is a situation where one party’s gain or loss is exactly balanced by the losses or gains of another party or parties. It is a concept that is often used in game theory, economics, and business to analyze the outcomes and strategies of different players in a competitive scenario. In a zero-sum game, the total benefit or cost of all the players is always zero, meaning that there is no net change in wealth or value. For every winner, there is a loser of equal magnitude.
Examples of Zero-Sum Games
Zero-sum games can be found in many contexts, both in real life and in theoretical models. Some examples of zero-sum games are:
Poker and gambling
In these games, the amount of money won by some players is equal to the amount of money lost by the others. The net change in the total money of all the players is zero.
Futures and options trading
In these financial instruments, the contracts represent agreements between two parties that are based on the price of an underlying asset. For every investor who makes a profit on a contract, there is another investor who suffers a loss of equal value. The net change in the total wealth of all the investors is zero.
Zero-Sum vs. Non Zero-Sum Games
Zero-sum games are the opposite of non zero-sum games, where the total benefit or cost of all the players is not zero, meaning that there is a net change in wealth or value. In non zero-sum games, the outcome can be beneficial or detrimental to all the players, or to some of them. Non zero-sum games are more common and realistic than zero-sum games, as they reflect the complexity and interdependence of real-world situations. Some examples of non zero-sum games are:
Trade and exchange
In these situations, two or more parties agree to exchange goods or services that they value differently. By doing so, they can both increase their utility or satisfaction, creating a positive sum game. For example, if Alice trades her apples for Bob’s bananas, and they both prefer the fruit they receive, they both gain from the trade.
Public goods and externalities: In these situations, the actions of one or more parties affect the welfare of others, without being reflected in the market price or cost. This can create positive or negative externalities, which are benefits or costs that are not internalized by the parties involved. For example, if a factory pollutes the air, it imposes a negative externality on the society, as it reduces the quality of life and health of the people. On the other hand, if a farmer plants trees, it creates a positive externality, as it improves the environment and the climate.
Implications of Zero-Sum Games
Zero-sum games have important implications for the behavior and decision-making of the players involved. They are competitive and adversarial, as the players have conflicting interests and goals. The players have to act strategically and rationally, taking into account the actions and reactions of the other players. The players may also try to deceive or manipulate the other players to gain an advantage.
Zero-sum games are often solved with the minimax theorem or the Nash equilibrium, which are concepts that determine the optimal strategy for each player, given the strategies of the other players. The minimax theorem states that a player should choose the strategy that minimizes the maximum possible loss, while the Nash equilibrium states that a player should choose the strategy that maximizes the expected payoff, assuming that the other players do the same.
Zero-sum games are not conducive to cooperation or collaboration, as the players have no incentive to work together or share information. The players may also face a dilemma or a paradox, where the individually rational choice leads to a collectively irrational outcome. For example, in the prisoner’s dilemma, the dominant strategy for each prisoner is to defect, but this results in a worse outcome for both prisoners than if they both cooperated.
Is Trading a Zero-Sum Game?
Yes, and no. In an environment where market participants are all fighting for fluctuations or price movements, this does create a zero-sum game scenario. In markets like the forex market or futures, most traders often just earn through capital gains which doesn’t lead to the creation of wealth.
However, things change when shares of companies are the assets being traded. While there will be traders who are looking to profit from price swings, there are also long term investors who aren’t looking to gain through quick trades. By pursuing gains through dividends or the overall growth of the company, the dynamics change from traders simply fighting for money between each other to the exchange of goods and services between market participants.
The overall lesson here being that fundamentals play a vital role in the stock market as it dictates whether a stock has the capacity to generate wealth. Something that will determine if the trading of shares will remain a zero-sum game.
This competition is OPEN TO ALL and will run for three months from April 22, 2024 to July 26, 2024
1. Registration. The competition officially begins on April 22, 2024 (Monday). You will receive a notification once you have been automatically added to the Competition Room and the Trading Cup is about to begin. Click here to join the competition.
Important notes:
Verification of ID is required before the competition starts. Once you are verified, you will be able to access the learning modules via InvestaUniversity, and in addition, this ID will be used to verify the winner’s identity during the awarding of prizes. Winners who did not send us a valid ID will be disqualified.
Only one (1) entry and account per person is allowed. If you have more than 1 account to join the competition, you will be immediately DISQUALIFIED.
You can change your Display Name, Username, and Profile Picture until THE DAY BEFORE the competition starts. Once the Trading Cup begins, the system will not allow you to change the above mentioned anymore.
2. Platform. The participants of Trading Cup 2024: The Global Quest will use the Virtual Trading Platform or vTrade of Investagrams which tracks the real-time price movements in the Philippine Stock Exchange (PSE), US Market, and Crypto Market.
3.New Markets. For the first time in Trading Cup history, we will now add the GLOBAL MARKETS, specifically the US Market and Cryptocurrency, to the competition. Everyone in the competition will have access to this.
4. Goal. The goal is simple – trade your account for the whole duration of the competition period and aim for the highest profits. The participants with the highest rankings while playing within the rules will be recognized as winners.
5. Multi Asset Portfolio. Each participant will have three (3) portfolios, one for each market (PSE, Crypto, and US) with 100,000 in buying power each.
PSE Portfolio
US Portfolio
Crypto Portfolio
₱ 100,000
$ 100,000
$100,000
You may opt to only trade one market, but this will put you at a disadvantage. So, it’s best that you take advantage of opportunities in all three markets.
6. Trading Hours.
PSE Trading Hours – 9:30am to 3:00pm
US Market Trading Hours (in PH Time) – 10:30pm to 4:30am
Cryptocurrency Trading Hours – 24 hours
7. Tradable Asset List. Participants can only trade the listed tradable assets for this competition. The tradable assets are filtered by our system and qualify as liquid and actively traded assets. You will be able to access the whole asset list once you are added to the Competition Room. This will be announced two weeks before the competition starts.
8. Diversification. To promote diversification and risk management, maximum exposure in a single asset can only be 1/3 or 33.33% of the portfolio. This requires the participants to buy at least 3 different assets should they want to fully invest their portfolio. The system won’t allow you to allocate more than 33.33% in a single stock.
The 33.33% rule applies to all portfolios. (PSE, US, and Crypto)
9. Trader Milestone. Participants can now receive rewards during competition by hitting certain milestones in their Trading Cup journey. Milestone rewards include:
Exclusive Trading Cup 2024 profile badges
Limited edition Investa Merchandise (for distribution after the competition ends)
InvestaGems
Exclusive Trading Cup Defense recording access
To claim the Milestones:
The collective profit across all three portfolios must reach the specified percentage.
Profit checking (for milestone unlocks) happens once a day only after the Philippine Stock Exchange (PSE) closes, not in real time.
10. Transaction Trading Fees (Long and Short Positions). To simulate real-life trading transaction fees on trading will apply with the following fee structure:
Market
Transaction Fees(long and short)
PSE
Approximately at 1.20% transaction fees (following PSE Standard comms, fees & vat on online trading)
US
0.25% per transaction
CRYPTO
0.10% per transaction
11. Buying and Selling Conditions (For LONG positions). Participants now have two options when transacting.
OPTION 1: The first option for transaction in this trading competition is to utilize limit orders for buying and selling specific assets. Instead of transacting at the current market price as with market orders, participants will set their own desired purchase or sale price through limit orders. This method ensures that trades are executed only when the stock price reaches the predetermined level set by the trader, offering more control over the transaction price.
It’s important to note that while limit orders provide price certainty, they do not guarantee execution, as the market may never hit the specified price. This approach is ideal for participants who prefer strategic entry and exit points, and are willing to wait for their target prices.
OPTION 2: The second option is to transact using our CONDITIONAL ORDERS. By using Conditional Orders, you won’t need to watch the market the whole day in order to transact in the market, you can now set AUTO CUT LOSS, AUTO TAKE PROFIT, and AUTO BUY ON BREAKOUT.
All these orders are by default GOOD TILL CANCELED, the order will remain active until your buy/sell price is hit or until the order is canceled . Watch this tutorial.
Buy – You can buy the same asset multiple times within a day.
Sell – YOU CAN SELL THE SAME ASSET SIX (6) TIMES PER DAY.
In one asset per day you can sell TWO TIMES (2) at a PROFIT.
In one asset per day you can sell FOUR TIMES (4) at a LOSS. (cutloss)
12. Buying and Selling Conditions (For SHORT positions). SHORTING is now available for this competition. The same thing applies if you want to short an asset, you can transact using the current price or set conditional orders if you can’t keep an eye on the market. We understand that many may not know the concept of shorting which is why we created a video tutorial you can watch here: LINK TO VIDEO
Sell – You can open a short position on the same asset multiple times within a day.
Buy – YOU CAN COVER YOUR SHORT POSITION ON THE SAME ASSET SIX (6) TIMES PER DAY.In one asset per day you can cover your short position TWO TIMES (2) at a PROFIT. In one asset per day you can cover your short position FOUR TIMES (4) at a LOSS. (cutloss)
FEES / COMMISSIONS: Same as long positions in the specific market.
COMPUTATION OF PROFITS: (Sell price – cover price)*shares – fees
For those who are not familiar on how to trade SHORT POSITIONS, here’s a STEP-BY-STEP guide to short-selling assets for this competition:
1. Choose your position from the market order type (long or short).
2. Upon choosing the short position, input the initial number of shares you want to sell.
Note: To short an asset, you have to SELL it first. Then to cover your position, you will need to BUY the shares back. To learn more please watch the tutorial: LINK
3. For closing the short position, select the short option in the market order type and input the number of shares you want to buy to close your short position.
Holding period for all assets (For both LONG and SHORT positions).
We will be applying the twenty (20) minute time lock for taking profits to ALL ASSETS to avoid widespread and rinse-repeat trades.
There will be no time lock or restrictions when selling at a loss.
13. Revision of Tradable Assets. Investagrams has the right to remove any assets from the list should it suddenly become too illiquid, abusable and/or delisted. Furthermore, Investagrams may also add new assets on the tradable list as new assets become more active and tradable in the market. All changes will be announced via the InvestaGroup and the Facebook Group upon revision of tradable assets.
In such cases that an asset is to be removed, we will follow this process:
Investagrams shall notify all the participants via the Investagrams Platform through an automated notification blast if there are any changes in the tradable assets list.
If you still have the asset in your portfolio, you can sell it at any point in time at your discretion.
Note: It is the participants responsibility to stay updated on the tradable assets list.
14. Initial Public Offering (IPO). All upcoming IPOs (in the PSE) that will happen while the Investagrams Trading Cup 2024 is on-going will be added on its SECOND (2nd) trading day.
15. On Dividends that will be given during the Trading Cup 2024.
Stock Dividends that will be released by a company will be credited at the END OF THE DAY of the ex-date. Please note that stock dividends will cause price adjustments, so be aware if a stock you’re holding will release stock dividends.
Cash Dividends that will be released by a company will NOT be credited to your total equity as the current system is still not able to credit cash divs.
Dividends whether stock or cash divs are only applicable to PSE.
16. On SRO that may happen during the Trading Cup 2024.
Stock Rights Offerings (or SRO) is offered to existing shareholders of a specific stock to purchase additional shares at a price lower than the current market price in addition to their current shares at hand.
SRO’s can be deemed good for longer-term investors. However, in the short term, may POTENTIALLY lead to a possible decline or gap down in the stock. So it’s important to always be aware of this.
Participants in the Trading Cup 2024 will not have an option to purchase additional shares from the SRO.
17. For stocks in the PSE that will be detected by our WIDE-SPREAD DETECTION SYSTEM (WSDS). The Wide-Spread Detection System’s main condition is that the first (1st) best bid and ask should never be more than 2% at any moment during open market session. This is only applicable in the PSE.
Fig 1. Real-time Market Depth / Orderbook showing the first (1st) best bid-ask data.
Example: $ATN (Refer to Fig. 1)
Given:
1st best bid = 1.11
1st best ask = 1.14
Formula:
X = (1st best ask – 1st best bid) / 1st best bid
Condition:
If X is greater than 2% then WSDS detects that the stock is wide-spread and can be abused.
Solution:
X = (1.14 – 1.11) / 1.11 = 0.02700 x 100% = 2.70%
Verdict:
Since X is greater than 2% then the stock is wide-spread as computed by the system.
The participant will be given a prompt that the detected stock is not tradable upon executing a buy or sell transaction.
The stock will again be tradable once the system detects that the spread of the 1st best bids/asks are below 2%.
18. On Trading Abuses.
Day trading opportunities on natural market moves are normal, but please take note that Investagrams will be on full-guard against participants that abuse illiquid opportunities. We want our winners to show real trading skills that are applicable in the PSE and Global Markets. Abuse of intraday spread trades will NOT BE TOLERATED. These rules are set to protect against the usual ‘rinse-and-repeat’ abuses that are mostly used in virtual trading competitions like this.
Any participants that have more than 10% of their profits from rinse-and-repeat wide spread, illiquid and other abusive trades will be penalized or DISQUALIFIED. We will be able to validate this through our data and algorithms that verify the historical transactions of each participant.
Any form of hacks, cheats, and abuses shall not be tolerated and will have corresponding repercussions. Suspicious behavior that may not be specified in the rules may also be flagged as ‘abusive’ trading behavior. All trade records shall be verified and those who fail to follow the rules will be disqualified.
Any participant who has constantly repeated any abusive trading behaviors (whether illiquid stocks, system abuses, loophole abuses) will instantly be DISQUALIFIED. Investagrams has the right to review any suspicious activity, and if the behavior is deemed inconsistent with real life trading then the said participant shall be disqualified.
A warning may be given, however, if the total profits of a participant have already reached 10% from rinse and repeat abuses upon initial review, an automatic disqualification will happen with no warning.
Questionable Transactions. Questionable transactions will be cross-checked through the buy and sell transaction time and the traded stock. Assets that have more than 2% consistent gaps in the one (1) minute timeframe within the transaction period shall be deemed invalid and Investagrams has the right to deduct the profits from the said transactions. It is normal to trade natural intraday moves and gaps can really happen, but if a participant is constantly trading assets that have gaps within one (1) minute timeframe and their profits from these kinds of scenarios make up more than 10% of their total profits, then he/she will be automatically disqualified.
Fig 2. Example 1 for one (1) minute time frame gaps with buy (green arrow) and sell (red arrow) transactions
Fig 3. Example 2 for one (1) min. time frame abusable 2% gaps
Fig 4. Example 3 for one (1) min. time frame abusable 2% gaps
Investagrams will disqualify any participant that is proven to be constantly transacting with illiquid assets with 2% one (1) minute gaps. Basically, any asset that has 2% spreads and does not really have a trend is included in this definition. Any participant that is proven to repeat this kind of behavior shall be disqualified.
19. Trading halt. Stocks that are on a trading halt will not be tradable during the halt and will be tradable again during the announced lifting time.
20. Participant rankings. This is constantly updated every 10-minutes and automatically ranked by Investagrams system according to net profit gain/loss.
21. How winners will be identified. To identify our Top 40 winners for the Investagrams Trading Cup 2024, the percentage gain of all three portfolios will be taken into account. The Top 40 participants with the highest average (equal weighted) percentage gain across all three portfolios will be our winners.
22. Top 10 Winners. Those who make it to the Top 10 will be REQUIRED to do a defense of their trading strategies used during the competition. This is basically a presentation where you will share your biggest winners, losses, and learnings during the Trading Cup. This has been the tradition of the Trading Cup for the past few years where the winners will share with the community how they made it to the top.
NO DEFENSE = NO CASH PRIZE.
23. Unexpected events. In the case of an unexpected event that interrupts the operations of PSE or the system of Investagrams, the competition shall be frozen and paused. Further notice shall be given and trading will resume once everything is back to normal.
24. Modification and adding of rules. Investagrams has the right to modify the rules of the competition and add protective measures against any future abuses that may arise to ensure the integrity of the Investagrams Trading Cup 2024: The Global Quest. Announcements shall be made if there are any changes. Rest assured, we prioritize keeping the competition as FAIR as possible to all participants.
25. Ignorance of the rules is no excuse. All participants are expected to have read and understood the rules and mechanics of Investagrams Trading Cup 2024: The Global Quest. These are published for the participants’ information and protection. Ignorance of these rules and mechanics is not an acceptable excuse for violation.
26. If you are part of the Top 40 winners, the FINAL DEADLINE to claim your cash prize is on July 31, 2024. The cash prize will not be given anymore past this date.
27. Sponsors. Apple is not involved in any way in this competition. The sponsor(s) is/are solely responsible for providing the prize(s) listed herein. The prize(s) won are not apple products, nor are they related to apple in any way. The responsibility of organizing this competition and distributing the prize(s) are the sponsors’ responsibilities. Apple does not sponsor this competition in any way.
28. Prizes from Partners. Some of our partners will be giving out prizes (in cash or in kind) which may be distributed on a different timeline or date depending on the partner. But rest assured that we will make sure that they will be provided.
29. Ultimate Pioneers. The Ultimate Pioneers will get free access to the competition and the trading cup defense. A special email will be sent to all Ultimate Pioneers to claim your free slot to the competition. You will have until March 31, 2024 to confirm your participation.
30. Joining theInvestagrams Trading Cup 2024: The Global Quest means that you agree with all the clauses mentioned above.
Investing is the process of putting your money to work for you, with the expectation of earning a return over time. Investing can help you achieve your financial goals, such as saving for retirement, buying a house, or funding your education. Investing can also help you grow your wealth, beat inflation, and create passive income.
However, investing is not a get-rich-quick scheme, nor a gamble. Investing requires patience, discipline, and a long-term perspective. Patience is crucial for investing, as it can help you overcome the challenges and uncertainties of the market, and reap the rewards of compounding and diversification. In this article, we will discuss some of the reasons why it is crucial for investing, and how to cultivate it.
Patience helps you ignore the noise
The market is full of noise, such as news, opinions, rumors, emotions, and events, that can influence your investing decisions. However, most of the noise is irrelevant, misleading, or short-term, and does not reflect the true value or potential of your investments. Patience helps you ignore the noise, and focus on the signal, such as the fundamentals, trends, and quality of your investments. It helps you avoid making impulsive, emotional, or irrational decisions, such as buying high, selling low, chasing fads, or following the crowd. Patience helps you stick to your investing plan, and act based on facts, logic, and analysis.
Patience helps you benefit from compounding interest
Compounding is the process of earning interest on your interest, or returns on your returns, over time. Compounding is one of the most powerful forces in investing, as it can exponentially increase your wealth, especially in the long run. However, compounding requires patience, as it takes time to accumulate and grow. Patience helps you reinvest your earnings, and let them compound over time. Patience helps you avoid withdrawing your money prematurely, or switching your investments frequently, which can reduce your compounding effect. Patience helps you harness the power of compounding, and achieve higher returns with lower risk.
Patience helps you diversify your portfolio
Diversification is the process of spreading your money across different types of investments, such as stocks, bonds, commodities, real estate, or cash, that have different characteristics, risks, and returns. Diversification is one of the most effective ways to reduce your portfolio risk, as it can protect you from the volatility and unpredictability of the market. However, diversification requires patience, as it means accepting lower returns in some periods, or holding some investments that may underperform or lose value. Patience helps you diversify your portfolio, and balance your risk and return. Patience helps you avoid putting all your eggs in one basket, or chasing the best-performing investments, which can expose you to more risk. Patience helps you optimize your portfolio performance, and achieve more consistent and stable returns.
How to Cultivate Patience for Investing
Set realistic and long-term goals: Patience for investing starts with setting realistic and long-term goals, such as saving for retirement, buying a house, or funding your education. You should have a clear and specific vision of what you want to achieve, why you want to achieve it, and how you plan to achieve it. You should also have a realistic and reasonable expectation of the returns and risks of your investments, and how long it will take to reach your goals. Setting realistic and long-term goals can help you stay motivated and committed, and avoid disappointment and frustration.
Do your research and due diligence: Patience for investing also requires doing your research and due diligence, such as studying the market, analyzing the investments, and evaluating the opportunities. You should have a sound and rational basis for your investing decisions, and not rely on hearsay, hype, or speculation. You should also have a thorough and objective understanding of the strengths, weaknesses, opportunities, and threats of your investments, and how they fit your goals, risk tolerance, and time horizon. Doing your research and due diligence can help you build your confidence and conviction, and avoid doubt and fear.
Review and monitor your progress: Patience for investing also involves reviewing and monitoring your progress, such as tracking your portfolio performance, measuring your results, and adjusting your strategy. You should have a regular and consistent schedule for reviewing and monitoring your progress, such as monthly, quarterly, or annually, and not too frequently or infrequently. You should also have a clear and relevant benchmark for comparing and evaluating your progress, such as an index, a peer group, or your own goals. Reviewing and monitoring your progress can help you learn from your successes and failures, and improve your decision making.
Conclusion
Patience is crucial for investing, as it can help you overcome the challenges and uncertainties of the market, and reap the rewards of compounding and diversification. Patience can help you ignore the noise, benefit from compounding, and diversify your portfolio. Patience can also help you set realistic and long-term goals, do your research and due diligence, and review and monitor your progress.
Patience is not easy, nor natural, for most investors, as it goes against the human nature of wanting instant gratification or avoiding pain and loss. However, patience can be cultivated, practiced, and improved, with the right mindset, attitude, and habits. Patience can make the difference between success and failure, wealth and poverty, happiness and misery, in investing and in life.
On Wednesday, January 10, 2024, the U.S. Securities and Exchange Commission (SEC) approved 11 applications for spot bitcoin ETFs, clearing the way for them to start trading on Thursday, January 11, 2024. This is a historic moment for the crypto industry, as it marks the first time that the SEC has allowed investors to access bitcoin directly through a regulated and transparent vehicle.
How It Happened
The approval of spot bitcoin ETFs has been a long-awaited and highly anticipated event for the crypto community. The first application for a bitcoin ETF was filed by the Winklevoss twins in 2013. However, the SEC rejected it in 2017. They cited concerns over market manipulation, fraud, and lack of regulation. Since then, many other applications have been submitted but none have received the green light until now.
The tide began to turn in 2021, when the SEC approved several bitcoin ETFs based on futures contracts, which are derivatives that track the price of bitcoin without holding the actual asset. These products, however, have higher fees, lower liquidity, and more complexity than spot bitcoin ETFs, which directly hold bitcoin in custody and reflect its market price.
The breakthrough came in June 2023, when Blackrock, the world’s largest asset manager, filed an application for a spot bitcoin ETF, signaling its confidence in the crypto space and its readiness to meet the SEC’s standards. Following Blackrock’s move, many other prominent financial firms, such as Fidelity, VanEck, WisdomTree, and Invesco, also filed their own applications for spot bitcoin ETFs, creating a critical mass of support and pressure for the SEC to act.
The SEC finally announced its approval of 11 spot bitcoin ETFs on Wednesday, January 10, 2024, after the close of trading. The approved products are:
Blackrock’s iShares Bitcoin Trust (IBIT)
ARK 21Shares Bitcoin ETF (ARKB)
WisdomTree Bitcoin Fund (BTCW)
Invesco Galaxy Bitcoin ETF (BTCO)
Bitwise Bitcoin ETF (BITB)
VanEck Bitcoin Trust (HODL)
Franklin Bitcoin ETF (EZBC)
Fidelity Wise Origin Bitcoin Trust (FBTC)
Valkyrie Bitcoin Fund (BRRR)
Grayscale Bitcoin Trust (GBTC)
Hashdex Bitcoin ETF (DEFI)
These products will be listed and traded on various stock exchanges such as Cboe, NYSE, and Nasdaq. Trading of BTC ETFs will start on Thursday, January 11, 2024.
What It Means for the Market
The approval of spot bitcoin ETFs is expected to have a positive impact on the crypto market. It will make bitcoin more accessible, attractive, and mainstream for investors. Some of the potential benefits are:
Increased demand and adoption
Spot bitcoin ETFs will lower the barriers to entry and reduce the friction for investors. This is especially true for institutional and retail investors who prefer to use traditional and regulated platforms. Spot bitcoin ETFs will also increase the visibility and awareness of bitcoin among the general public.
Improved liquidity and efficiency
Spot bitcoin ETFs will increase the trading volume and liquidity of bitcoin, as they will create more arbitrage opportunities and market participants. They will also improve the price discovery and efficiency of bitcoin. Hopefully, this will reflect its true market value and reduce the discrepancies between different platforms and regions.
Enhanced security and transparency
Spot bitcoin ETFs will offer a higher level of security and transparency for investors. they will be subject to the oversight and regulation of the SEC and other authorities. Spot bitcoin ETFs will also have to comply with strict standards of custody, auditing, reporting, and disclosure. This is all to ensure that investors’ funds are safe and accounted for.
On a Side Note
The approval of spot bitcoin ETFs is a major milestone for the crypto industry, as it demonstrates the growing recognition and acceptance of bitcoin as a legitimate and valuable asset class. Spot bitcoin ETFs will likely boost the adoption and innovation of bitcoin and other cryptocurrencies, paving the way for a more inclusive and decentralized financial system.
While this is definitely a bullish development, remember that anything can happen in the markets. Cryptocurrencies will most likely experience long-lasting bullishness. However, this news could become a “sell on news” kind of event given that everyone has already been anticipating this to occur.
From left to right: Ms. Patricia Tan, SVP, Customer Segmentation Head, Security Bank; Mr. Rahul Rasal, EVP, Retail Banking Segment Head, Security Bank, Mr. Airwyn Tin, Co-CEO, CTO, and Co-Founder, Investa, and Ms. Joanne Marquez, Head of Marketing, Investa
[Manila, Philippines] – Security Bank Corporation and Investagrams Inc. mark a significant milestone for the Philippine financial landscape as it announces a strategic partnership on November 29, 2023 aimed towards financial empowerment and the creation of innovative solutions for our valued customers.
This initial collaboration brings together the strength and reliability of Security Bank, a leading financial institution focused on customer-centric service, and Investagrams Inc., a social financial platform dedicated to empowering Filipinos in starting their investment journey.
Security Bank is one the leading universal banks in the country serving clients from commercial, retail, corporate, business (MSME) and institutional industries. Receiving various awards through the years for being one of the most stable banks in the industry, Security Bank continues to pursue excellence in providing solutions for every client’s needs.
Meanwhile, Investagrams is the leading social financial platform in the Philippines geared towards helping Filipinos start their investing journey with the right tools, education, and technology. They provide users with advanced analytic tools, educational content, market research, trade and investing ideas, and an exclusive social network platform for traders and market enthusiasts.
Key Features of the Partnership
The integration of Security Bank’s flagship credit card offerings on the Investagrams Inc. platform is one of the key highlights of this partnership. This will enable users to seamlessly explore and apply for Security Bank’s credit cards directly on Investagrams’ platform offering a streamlined and user-friendly experience.
Security Bank’s credit cards are renowned for their convenience and suite of benefits designed to cater to the diverse financial needs of consumers. By featuring these credit card options on Investagrams, both companies hope to give their users a comprehensive financial toolkit, combining the convenience of digital banking with powerful investment tools.
As part of this partnership, both Security Bank and Investagrams Inc. had their contract signing at Security Bank’s Head Office to show their commitment to the ongoing collaboration and leveraging their respective strengths to enhance the overall financial well-being of users of both platforms.
This strategic alliance represents a powerful synergy between traditional banking and modern financial technology, underlining a shared commitment to innovation, accessibility, and customer-centric solutions. Security Bank and Investagrams Inc. look forward to a successful partnership that will redefine the landscape of financial services and empower individuals on their journey to financial success.
Paper trading is a practice of simulating trading activities without risking real money. It is also known as virtual trading, demo trading, or backtesting. It can be done manually, using a spreadsheet or a journal, or electronically, using a platform or a software program.
Paper trading can be useful for beginners who want to learn the basics of trading
It teaches you how to place orders, read charts, use indicators, and apply strategies. It can also be helpful for experienced traders who want to test new ideas, refine their skills, or evaluate their performance.
However,it is not without its limitations and drawbacks. In this article, we will discuss some of the pros and cons of paper trading, and whether you should try it or not.
Pros of Paper Trading
No risk of losing money
The most obvious benefit of paper trading is that you can trade without risking any of your hard-earned money. This can reduce the stress and emotions that often affect trading decisions, such as fear, greed, overconfidence, or regret. It can also allow you to trade with larger amounts or higher leverage than you would normally do, which can boost your confidence and learning curve.
Learning opportunity
Paper trading can be a great way to learn the mechanics and dynamics of trading, especially if you are new to the market. You can familiarize yourself with the trading platform, the order types, the market conditions, the technical analysis tools, and the trading strategies. You can also learn from your mistakes and improve your trading plan without losing money.
Testing ground
Paper trading can be a useful tool for testing and validating your ideas, systems, or strategies. You can backtest your strategies using historical data, or forward test them using live data. You can also compare different strategies, parameters, or markets, and see which ones perform better. It can help you optimize your performance and find your edge in the market.
Cons of Paper Trading
Lack of realism
Paper trading can never fully replicate the real environment, as there are many factors that affect trading outcomes that cannot be simulated. For example, it does not account for slippage, commissions, spreads, liquidity, execution speed, or market impact. Paper trading also does not reflect the psychological and emotional aspects of trading, such as stress, anxiety, excitement, or boredom. It can create a false sense of security or success, which can lead to overconfidence or complacency when switching to real trading.
Different results
Paper trading can produce different results than real trading, due to the factors mentioned above. It can also be influenced by hindsight bias, confirmation bias, or survivorship bias, which can skew your perception and evaluation of your trading performance. Paper trading can also be affected by data mining, curve fitting, or overfitting, which can make your strategies look good on paper, but fail in reality.
Limited feedback
Paper trading can provide limited feedback on your performance, as you do not experience the consequences of your actions. It can also make you less accountable and disciplined, as you do not have to follow your rules or risk management. It can also make you less motivated and committed, as you do not have any skin in the game.
Should You Try Paper Trading?
Paper trading can be a valuable tool for learning and testing trading, but it should not be the only or the final tool. It can help you develop your trading skills and knowledge, but it cannot replace the real trading experience. It can also help you prepare for real trading, but it cannot guarantee your success or profitability.
If you want to try it, try to remember these considerations:
Set realistic goals and expectations: Paper trading should not be used as a way to make money, but as a way to learn and improve. You should set realistic and measurable goals for your paper trading, such as learning a new strategy, improving your win rate, or reducing your drawdown. You should also be aware of the limitations and differences, and not expect the same results in real trading.
Treat it as real trading: Paper trading should be treated as seriously and professionally as real trading. You should follow your trading plan, rules, and risk management, as if you were trading with real money. You should also record and review your paper trades, and analyze your performance and feedback. You should also avoid changing your strategies or parameters too often, or jumping from one market to another, as this can reduce your consistency and reliability.
Transition to real trading: It should not be done indefinitely, but as a stepping stone to real trading. You should have a clear and specific criteria for when to switch from paper trading to real trading, such as reaching a certain level of profitability, confidence, or competence. You should also start with small amounts or low leverage when transitioning to real trading, and gradually increase them as you gain more experience and comfort.
Paper trading can be a helpful and effective way to learn and practice trading, but it should not be the end goal. Itg can help you develop your trading skills and knowledge, but it cannot replace the real trading experience. It can also help you prepare for real trading, but it cannot guarantee your success or profitability.
As with any endeavor
Practice is an important aspect towards becoming better. For trading, there are many ways to improve. While some might find paper trading boring, it wouldn’t hurt to try it out. You could test some of your strategies, or even just try to look for inspiration for new ones. If you’re looking for a place to do so, check out vTrade.
Additionally, if you really want to test out your skills you can check out the upcoming Trading Cup 2024! Details will be posted on the Investa pages soon, so stay tuned!
Exchange-traded funds, or ETFs, are a type of investment that combines the features of stocks and mutual funds. ETFs are collections of securities, such as stocks, bonds, commodities, or currencies, that track the performance of an underlying index, sector, or theme. They trade on stock exchanges, like individual stocks, and can be bought and sold throughout the day at market prices. They also offer investors a convenient and cost-effective way to diversify their portfolio and gain exposure to various markets and strategies.
How do ETFs work?
ETFs are created and managed by fund providers, such as Vanguard, BlackRock, or State Street. These providers create ETFs by pooling money from investors and buying the securities that make up the ETF. The providers then issue shares of the ETF to the investors, who can sell them to other investors on the secondary market. The number of shares of an ETF is not fixed, but can change depending on the supply and demand. If more investors want to buy an ETF than sell it, the fund provider can create more shares by buying more securities. Conversely, if more investors want to sell an ETF than buy it, the fund provider can redeem shares by selling securities.
The price of an ETF is determined by the market forces of supply and demand, as well as by the value of its underlying securities. The value of the underlying securities is reflected by the net asset value (NAV) of the ETF, which is calculated by dividing the total value of the securities in the ETF by the number of shares outstanding. The NAV of an ETF is updated throughout the day, as the prices of the securities change. The market price of an ETF may differ from its NAV, depending on the trading volume, liquidity, and market conditions. This difference is called the premium or discount of the ETF. Ideally, the market price and the NAV of an ETF should be close to each other, to ensure fair and efficient trading.
What are the benefits of ETFs?
ETFs offer several advantages to investors, such as:
Diversification
ETFs allow investors to access a wide range of securities, markets, and strategies with a single purchase. This reduces the risk of investing in individual securities, as the performance of the ETF is not dependent on the performance of any single security. ETFs also enable investors to diversify across different asset classes, such as stocks, bonds, commodities, or currencies, and across different regions, sectors, or themes, such as emerging markets, technology, or environmental, social, and governance (ESG) factors.
Cost-efficiency
ETFs typically have lower fees and expenses than mutual funds, as they do not have active managers who charge management fees or incur trading costs. They have lower tax implications than mutual funds, as they do not distribute capital gains to shareholders, unless they sell their shares. They only incur brokerage commissions when they are bought and sold, which can be minimized by using low-cost brokers or platforms.
Flexibility
ETFs can be traded at any time during the day unlike mutual funds. They also offer investors the flexibility to use various trading strategies, such as limit orders, stop orders, margin trading, or short selling, which are not available for mutual funds. ETFs also have the flexibility to be customized according to the investor’s preferences, such as by using exchange-traded notes (ETNs), which are debt instruments that track the performance of an index or a commodity, or by using inverse or leveraged ETFs, which amplify the returns or losses of an index or a sector by using derivatives or borrowed funds.
What are the risks of ETFs?
ETFs also have some drawbacks and risks that investors should be aware of, such as:
Liquidity risk
ETFs may face liquidity issues, especially for those that track niche or illiquid markets or sectors, such as emerging markets, commodities, or currencies. Liquidity refers to the ease of buying and selling an asset without affecting its price. If an ETF has low liquidity, it may have a large bid-ask spread, which is the difference between the highest price that a buyer is willing to pay and the lowest price that a seller is willing to accept. A large bid-ask spread can increase the trading costs and reduce the returns of the ETF. Investors should check the trading volume and the bid-ask spread of an ETF before buying or selling it.
Market risk
ETFs are subject to the same market risks as their underlying securities, such as volatility, inflation, interest rate changes, or geopolitical events. These risks can affect the prices and the returns of the ETFs, regardless of their diversification or cost-efficiency. Investors should be aware of the market conditions and the potential impacts on their ETFs, and adjust their portfolio allocation and strategy accordingly.
Conclusion
ETFs are a popular and versatile type of investment that offer investors a convenient and cost-effective way to diversify their portfolio and gain exposure to various markets and strategies. ETFs have several benefits, such as diversification, cost-efficiency, and flexibility, but they also have some drawbacks and risks, such as tracking error, liquidity risk, and market risk. Investors should understand the features, benefits, and risks of ETFs, and compare different ETFs before choosing one that suits their goals and risk tolerance.
