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Tarik

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  1. Hello Samir, thanks for asking! There’s not one Forex pair that you can say is the most profitable currency pair. In general, the most popular and liquid pairs are EUR/USD, GBP/USD, and USD/JPY. These three currency pairs show the highest amount of trading activity and volume.
  2. Hi Samir, thanks for coming here. These three types of stocks are mostly different in the return that they yield. Let’s look at each category to see what are their key characteristics. The growth stocks keep investors happy as their growth rate is very high. This group of stocks is usually growing at a faster rate than the overall stock market and yielding higher rates of return. Therefore, this is considered to be an aggressive strategy that is mainly focused on the growth rate, which is then reinvested in the business to further accelerate the growth rate. For these reasons, the growth stocks are usually of those new innovative companies, such as those in the tech sector. The second group is the income stocks. As the name itself says, the income stocks focused on generating income for its investors, mostly through dividends. This way, investors tend to focus on companies that regularly pay dividends. As such, this income is usually budgeted as the chance of the company X paying dividends is extremely high. On the other hand, these companies may not have a high growth rate. The most common income stocks are those of well-established, profitable companies e.g. Coca Cola. Value stocks are the least common of the three categories of stocks. The value stocks are mostly identified by analysts as shares of companies that are likely undervalued by the market and likely to outperform the market in the mid-term. These stocks are closely tied to the concept of fundamental analysis as you need to have a strong understanding of financial analysis in order to analyze the company’s financial state to identify undervalued stocks. All in all, you should choose which type of investor you are. If you are looking for an aggressive and more risky investing strategy, then you should go for growth stocks, unlike the other two that are more connected to well-established companies.
  3. Tarik

    Bitcoin price

    Hi Predrag, thanks for the question. Bitcoin looks well-positioned to continue surging higher in June. When I look at the price action in Bitcoin in May, I see that the buyers keep coming back to test the resolve of the sellers, no matter how many times they are knocked down. This is a characteristic of persistent bulls, that usually yields results for them. This is despite Goldman Sachs, one of the biggest U.S. banks, outlined five reasons why you shouldn’t invest in Bitcoin. In a leaked slideshow, the bank said that Bitcoin “is not an asset class,” nor “a suitable investment.” Accordingly, you shouldn’t invest in Bitcoin, as: 1. It doesn’t produce cash flow like bonds. 2. It doesn’t generate profit through exposure to global economic development. 3. Bitcoin doesn’t deliver consistent diversification gains due to unstable correlations. 4. It doesn’t increase volatility given historical volatility of 76%. The bank noted the case when Bitcoin plunged 37% in a single day, alleging that its volatility is off the charts. 5. It provides no proof of hedging against inflation. “We believe that a security whose appreciation is primarily dependent on whether someone else is willing to pay a higher price for it is not a suitable investment for our clients. We also believe that while hedge funds may find trading cryptocurrencies appealing because of their high volatility, that allure does not constitute a viable investment rationale,” the bank wrote in a presentation. Despite the bank’s claims, Bitcoin jumped 4% on Friday to record another positive day. A move above $9,2000 allows Bitcoin buyers to target the key short-term resistance at $10.000. If broken, the path towards $10,300 and $10,500 would be open. Also, any above the latter creates a new 20-month high for the world’s largest digital coin.
  4. Tarik

    RWE stock price

    Hi Samir, thanks for the question. Shares of RWE AG (ETR: RWE) have performed positively in the past few weeks. The stock price gained more than 13% in May to trade at a 3-month high. Therefore, the RWE stock price traded briefly above the 30.00 mark for the first time since the first week of March. The RWE stock was always positioned to recover faster. Unlike some other stocks that lost 60%-70% during the COVID-19 market selloff, RWE stock price declined “only” 40% in February and March. The buyers are now eyeing a trip to 34.50, which comes around 15% higher compared to the current market price. If hit, this will represent a new 7-year high for shares of RWE AG. The positive performance was a result of the energy giant posting a very good first quarter, despite the coronavirus pandemic.bRWE announced a jump of the first-quarter profits by 19% to $1.41 billion. “On our side the power generation business has very limited impact from the corona situation. Of course, we see muted power demand but usually our positions are hedged very well in advance and that is why we have seen, so far, very limited impact.” Unlike some other companies that are decreasing its capital expenditure budgets, RWE reiterated it will continue with its planned investment of 5 billion euros to further expand its renewables portfolio. However, the energy giant is also facing some headwinds. Naturstrom, a Germany-based energy retailer and 10 other energy companies started legal action against RWE. The subject of the legal action is RWE’s proposed $45 billion mergers with E.ON’s conventional and renewable generation assets. “By waving through the deal between RWE and E.ON to split up the energy market without serious conditions, the Commission has abandoned the goal of fair competition in the German and European energy market. That is a backward role, considering that the same commission has been pursuing liberalization of the electricity market for over 20 years,” said Dr. Thomas Banning, CEO of Naturstrom. The lawsuit is made on Article 263 of the Treaty on the Functioning of the European Union.
  5. Tarik

    Telefonica telecom

    Hi Predrag, Thanks for the question. Yes, indeed, shares of Telefonica surged yesterday after the European Union’s General Court unblocked the sale of the UK’s O2 to Three UK. The agreed deal was blocked by the EU’s competition body in 2016, preventing the Three UK (owned by Hutchison Holdings) to buy Telefonica’s O2 for $12.6 billion. “The commission takes note of the General Court’s decision annulling the commission’s decision of 11 May 2016 prohibiting Hutchison’s proposed acquisition of O2 UK. The commission will carefully analyse the judgment,” the EU Commission statement reads. Hutchinson argued that the competition enforcers made “several errors of law” and could not prove that the expected merger will hurt competition activity. “The commission’s approach has unfortunately acted as a brake on, or in a number of cases prevented, network improvements and consumer benefits that can be achieved from mobile mergers. Legal practitioners are seeing this decision from the Luxembourg-based General Court as a very important milestone and a “landmark” judgment. “This landmark judgment represents a significant setback for Commissioner Vestager. Challenging four-to-three consolidation in the telecommunications sector has been a central feature of merger enforcement under her watch and the judgment will be studied closely to see the extent to which it may allow further consolidation in the sector,” Nicholas Levy, a Brussels-based partner at law firm Cleary Gottlieb, wrote. As a result, Telefonica stock price surged more than 4% on the news. The expected sale will provide the Spain-based telecom giant with funds to keep expanding its core business. The price is now expected to go to the 5.00 mark, where a key resistance is located. In March, shares of Telefonica printed the record low at 3.53 on the coronavirus-related market selloff. Earlier this month, Telefonica began consultations with Virgin Media on a possible merger with 02.
  6. Tarik

    USD/JPY forecast

    Hi Samir, Thanks for your question. USD/JPY has been trading in a range for the last week after it surged higher. It is actually a very tight range as the price action trades between $107.35 and $108.00 for a week now. This consolidation in a tight range has the shape of a bullish rectangle, as the price action formed this range from an uptrend, and after a consolidation (the rectangle), we may see the price action continuing higher. “USD continues to trade in a quiet manner and the build-up in momentum from last week has dissipated. [The dollar] is likely to trade sideways for now,” FX Strategists at UOB Group said. Moreover, the consolidation phase that is conducted in a narrow range tends to explode higher. Hence a break to the upside or lower is expected to be of a strong nature. Looking forward, a lot depends on how Trump’s speech on China is going to be perceived by the market. If he takes a more aggressive stance, we may see a risk-off environment that will yield in a lower USD/JPY. “The risk tones in the market are looking more cautious/defensive and has seen quite a turn of events following the announcement by US president Trump here yesterday. All eyes will be on that now but the dollar in general also isn't faring too well ahead of European trading, so that is adding to the softness in USD/JPY here,” currency analyst Justin Low said. Hence, I think the best way forward is wait-and-see for the USD/JPY pair. If there was no risk associated with Trump, I’d say that the pair is primed to trade higher, however, the US-China tensions may drag the entire market lower. In the short-term, any move lower is likely to be stopped at $106.80, where the 61.8% Fibonacci retracement is located.
  7. Tarik

    Diversification

    Hi Samir, thanks for coming here. Diversification is a term that is closely associated with risk management. What this basically means is that a certain group of investors believes that you shouldn’t invest all funds into one asset, or the same group of assets, but rather spread your investments across the asset class to minimize the risk. Therefore, your portfolio should be diversified on a range of investments in order to reduce risk. Let me give you an example. If you want to invest $100,000 in the stock market, this theory tells you to diversify your portfolio and buy some bonds, stocks, currency, commodities etc. In addition, if you buy stocks, don’t make all of your investments in the tech sector. For instance, you should invest one part in tech stocks, another in food stocks, pharma stocks etc. This way, you are better protected. Diversification can be done: by asset class, by markets and regions, and different management styles. Diversification by asset class is a very popular model. As said in our example, you should spread investments across different classes, markets, and regions. Moreover, you can further diversify by investing in assets with a different rate of return. This is also where the rebalancing of portfolios comes into play. Depending on the performance of portfolio categories, you may want to increase the weight on a certain category (e.g. stocks) at the expense of another one (e.g. gold). If you feel that the risk-off trading environment is now active, then you will rebalance by selling some stocks to buy safe-haven assets, such as gold. Diversification by markets and regions is when you diversify in geographical context e.g. buying assets in different regions, markets, currencies etc. Finally, some investors may look at the different CEO management styles and not put all their eggs in companies that, for instance, have CEOs at the helm that are implementing an aggressive strategy.
  8. Tarik

    Theta

    Hi Samir and thanks for the question. Yes, indeed, the price of THETA token exploded this month to hit an all-time high at $0.4782. It has been announced recently that Samsung plans to pre-install Theta.tv streaming platform into all-new Galaxy S20 smartphones. This way, Samsung will use Theta.tv to offer gaming and esports streaming service to its customers. In addition to S20, the new update will bring the service to Galaxy S10, S9, Note 10 and Note 9 smartphones as well, which amounts to more than 75 million devices over the world. “We believe this commercial product launch is a critical inflection point in the adoption of the Theta Network globally. Our groundbreaking approach to streaming is a perfect fit for Samsung’s worldwide user base. It’s a huge step toward our goal of making Theta a global infrastructure for video content and data delivery,” said Mitch Lou, co-founder and Chief Executive of Theta Labs. Separately, the Theta community is eagerly expecting a major platform upgrade that is scheduled to take place on May 27. “No single group or entity will control the majority of THETA staked,” the Theta team wrote in a blog post, describing the upgrade as a “significant milestone toward Theta’s decentralization”. Hence, the Theta platform is making the life of its token THETA much easier. The price action exceeded the previous record highs sitting at around $0.30, to extend more than 60% higher and hit record highs just below $0.48. THETA is now ranked 28th by the market value.
  9. Tarik

    Zilliqa

    Hi Predrag, thank you for coming here. Not just yesterday, but Zilliqa price has been pushing higher constantly in the past few weeks. There isn’t a single development that can be pointed to as a key reason for the surge in price but rather a series of events surrounding the Singapore-based blockchain platform. For instance, a listing of a ZIL/BUSD trading pair on Binance was announced last week. In addition, the co-founder of Ethereum Vitalik Buterin acknowledged the progress that the Singapore-based blockchain platform has made lately. Zilliqa has been very active in marketing campaigns lately. The platform launched the SocialPay campaign, to which it dedicated around $3,500 in rewards for Twitter users who discussed the services of the platform during a 3-day campaign. As a result, Zilliqa topped the list of top 5 most-discussed altcoins on Twitter, with more than 80,000 tweets recorded and engagements from 35 million Twitter users. Furthermore, an article in the investing media outlet TheStreet praised Zilliqa’s recent progress and chose the platform as the “cryptocurrency of the week”. “With everyone locked up at home, this easy way to make pocket money proved immensely popular. Not only that, but the tactic is actually very powerful for spreading awareness of Zilliqa, and for making a programming language for developers called Scilla more widespread,” the article notes. All in all, the Zilliqa platform seems to be thriving. It has gained around 120% so far in May to hit the 10-month high around $0.014.
  10. Tarik

    Markets

    Hi Predrag, thanks for coming here. The basic market concepts are the primary and secondary markets. The former term refers to a market where the securities are first being issued. On the contrary, the latter is where the majority of stock market trading is taking place. In the secondary markets, investors are trading securities that they already own. In the stock market, the primary markets are mainly used by companies to sell their stocks for the first time. This can be done through the initial public offering (IPO), private placement or preferential allotment. In primary markets, securities are always purchased directly from the issuer. On the contrary, the owner of security can then trade it on a secondary market after purchasing it in the primary market. Therefore, transactions in the secondary markets are of a more trading purpose. The most popular secondary markets are exchanges e.g. NASDAQ, NYSE, London Stock Exchange etc. One of the key differences between these two is that in the primary markets prices are created by the issuer of a security. On the other hand, the market forces (buyers and sellers) are creating supply and demand in the secondary market, hence the prices are made by the market itself.
  11. Tarik

    Home Depot

    Hi Predrag, thanks for coming here. The reason why shares of Home Depot hit record highs in the past few days is better-than-expected quarterly earnings. The retailer said its same-store sales grew 6.4% in the first quarter while revenue jumped 7.1%. However, the earnings came in below the expectations due to higher costs related to the coronavirus pandemic. Home Depot also said that the average ticket increased 11% on the rush buying in supermarkets at the beginning of the coronavirus pandemic. Although its physical stores suffered, Home Depot reported an increase of 79% in online sales compared to the same period last year. “As shelter-in-place orders rolled out across the country in mid- to late-March, we saw our digital businesses accelerate from approximately 30% growth in early March to triple digit growth in early April. During the last three weeks of the quarter, traffic to HomeDepot.com was consistently above Black Friday levels,” the executive vice president of merchandising Ted Decker said. Hence, this is the reason why Home Depot stock hit record highs. Almost all stocks of companies active in the e-commerce sector soared higher on the expectation of a rise in demand during the pandemic lockdown measures.
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