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Investing tools & techniques

Linkedin.com or How to Milk the Social Cow

linkedincom-logo-courtesy-of-the-investment-blog-doitinvestcom-vs1 This is becoming a fashion now – everybody talks about investing in social media. Facebook.com is valued anywhere between $40 billion and $100 billion, based on what the private investors paid for. RenRen, its Chinese counterpart, is already at $7.5 billion. And more are to come…
But one company did the step and they did it at the right moment. Linkedin.com, the site for professionals interaction who was launched in 2003 (before Facebook.com, launched in February 2004), listed itself this month. And it made it big time, with its shares increasing in 1 day to 90 USD/share, more than Google.
Why is this launch important?
First of all, because linkedin.com is the first major public listing of a social media company. Others are just talked about and valuations are very estimative, but linkedin.com opened the sector doors with a successful launch.Read More »Linkedin.com or How to Milk the Social Cow

The Best Paid Finance Jobs Today

I was recently browsing the internet for an update on the most interesting jobs in the finance field. Especially in banking, the offer has changed a lot in the last 2-3 years. Whilst in 2008-2009 the best paid jobs and with a relatively large demand were in the area of commercial finance and investment banking, now the situation has changed.
I hope you got curious by now. The results of my mini research are quite surprising: there is a big demand again for banking jobs in a certain area. And the salary offered is quite substantial. Could you guess in which area?Read More »The Best Paid Finance Jobs Today

Adventures of a Trader in the Forex Land (8) – Where Is the Dollar Going?

doitinvestcom-forex-trading-blog-where-is-the-usd-going-eur-usd-chart-showing-the-euro-growth-over-the-beginning-of-2011 I am sure this is a question that haunts most of the today’s traders. And of course if you would know the answer, we would not know on which island you would live :).
A simple graph (at the beginning of this blog) is showing that the EUR/USD pair has ramped up from 1.3552 to 1.4825 (as of today May 4). This is a historically large level, as the EUR/USD has rarely jumped above 1.5 (and this only in the great crisis). So why is the dollar so weak nowadays versus the Euro?
There are several reasons for that I guess:

1. Large USD deficit
I was recently reading an article in The Economist showing that by the same method of calculation, the US budget deficit is larger (as a % of GDP and at 11% or so) tha the one of Portugal. A large deficit also means problems for the dollar, since the US government has to finance this somehow and devalue the currency. Thus the consequence.Read More »Adventures of a Trader in the Forex Land (8) – Where Is the Dollar Going?

Book Review – “Investment Performance Measurement – Evaluating and Presenting Results” by Philip Lawton and Todd Jankowski (editors)

Here’s the handbook for the professional investment manager or for those who want to have in their libraries a reference volume: “Investment Performance Measurement – Evaluating and Presenting Results” not only contains almost 1,000 pages of technical articles, but it is also nicely organized.
In a sense, “Investment Performance Measurement – Evaluating and Presenting Results” represents a complete reference for the CFA (“Chartered Financial Analyst”) who wants to keep in touch with some technical issues. The book contains 5 parts, which take you from the introductions to the portfolio and risk management theories to the latest developments in the field (part 5 is named “Global Investment Performance Standard”, a right adagio for the cross-continental savvy manager).
It is hard for me to start somewhere with this review – and this is because of the content richness. “Investment Performance Measurement – Evaluating and Presenting Results” contains lots of articles on investments performance, some of them very mathematical, others very behavioral and others … well, unusual.
A very mathematical chapter (yet a very interesting one) is called “On the Performance of the Hedge Funds”, which combines a mathematical approach with a risk methodology in order to give the reader a better view on how to approach a fund. It is not easy, since a hedge fund tries to balance actually the risks inherent in the portfolio with a need for strong and constant returns. The fact that few hedge funds manage to have a constant performance over the long term just lays the nature of the game. Yet, when you invest lots of money in such a vehicle, I think you should at least try to understand its composition and the formula to calculate the average returns on the fund (or the yield of it). But the authors of the article go beyond this – they actually run a regression to see if the various fees paid to the mangers have an impact on the performance. Guess what – yes they have an effect and it is quite substantial – for the rest of the details I will just let you read the article itself.Read More »Book Review – “Investment Performance Measurement – Evaluating and Presenting Results” by Philip Lawton and Todd Jankowski (editors)

Book review on “Human Resource Management”, 2nd Edition by Greg L. Stewart (University of Iowa), Kenneth G. Brown (University of Iowa)

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human-resources-management-book-review-by-wwwdoitinvestcom-an-investing-and-research-blo

There are rare cases where you see a study text on HR management linking so well the strategic theory with the day to day practice – and the accent here falls on strategic. Furthermore, the human resources management seems to be relatively neglected in the companies, although many experts argue that now, when the end of crisis is approaching, it should be more important. Not only should HR managers increase their focus on how to motivate better the battered employees, but also they should face the challenge of retaining the so much needed valuable assets – the ones who walk out of the door every day.
One more trigger for my reading “Human Resource Management” is my own experience (as I mentioned several times on the investing blog). Book reviews should bring in something tangible for the reader – and for me it provided a link with my experience. Specifically, at certain moments of time all of us find themselves managing other people – be it our subordinates or bosses from the same company, our employees in our entrepreneurial endeavors, or other stakeholders. At the end of the day, what counts is how successful we manage all those people, so that:
– they feel motivated, satisfied and rewarded by the working relationship with us;
– we achieve our own objectives and get a feeling of achievement.
There are two ways you can do this:
– you read lots of psychology and management books, then try to round up all the theories and distill what you found out or
– you spend your money and time on a well-written book and get the most of other people’s experiences.
Well, you can guess I chose the second path. And this is what happened with my reading of the “Human Resource Management” study text.
There are countless points where this book proved valuable for my experiences. What I used several times and enjoyed the specific chapter called “Developing Employees and Their Careers”. The question of the egg or the hen is apparent here all the times – should we motivate people to get results or should we make them get results to be motivated? As you would expect, there are no definitive answers to this, but at least I could get a feeling of completeness when I started to apply various theories in various situations, with good to excellent results.
Another feature of the book that I liked was “Research made easy”: Throughout “Human Resource Management” the authors highlight in the How Do We Know section recently published research from scholarly journal in non-technical language. Each of the sections concludes with a “Bottom Line” summary that shows how the findings of the study contribute to our understanding of effective human resource management. This also allows you to pursue your own further research.
All in all, a nice study book on the neglected field of the HR management. Read More »Book review on “Human Resource Management”, 2nd Edition by Greg L. Stewart (University of Iowa), Kenneth G. Brown (University of Iowa)

An Investment Book Review –“International Corporate Finance” by J. Ashok Robin

Well, this came as almost a treat – corporate finance, which in itself is an investment topic to be studied, on an international context. There are many textbooks on the market which study the corporate finance topics, from the main financial decisions of a corporation to financial instruments or the (in)famous weighted average cost of capital (WACC). In an international context, there are quite few study texts.
The field of International corporate finance deals with the various financial activities of international corporations or multinational companies. This book is even more focused – it concentrates on the multinational companies (MNC’s or MNE’s) and on their blood who keeps pumping and make them grow –the flow of money.Read More »An Investment Book Review –“International Corporate Finance” by J. Ashok Robin

An Investment Book Review – “Global Business Today” by Charles. W. L. Hill

If you have not heard about the multinational companies or multinational enterprises (shortly called MNC’s or MNE’s) and if you are working with shares, you are probably from another planet – or you simply do not care. I can simply assume that 99% of the readers of this book review have heard about the fantastic turnovers they have, about their cross-continental span or about how many people have successful careers in the MNC’s. I am actually one of the persons who happen to know quite well how multinational companies work – and yet I know quite a small portion of what I should know.
The multinational companies can reshape dramatically the earth they walk on, this is why I decided to read a book on how they work. And “Global Business Today” by Charles. W. L. Hill is a treat in itself. If you are accustomed with the McGraw Hill’s study text format, then you will know that their books are comprehensive and packed with study cases. “Global Business Today” does not make an exception, yet it has something more – it is about a subject which touches many aspects about our everyday lives.Read More »An Investment Book Review – “Global Business Today” by Charles. W. L. Hill