Investing Techniques for Beginners

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One of the most common questions that financial advisors get asked is whether or not now is a good time to buy stocks. The answer is yes, as long you are buying reputable companies with proven track records. No one can truly predict what will happen next on the market and it is never a good idea to try and do so. SSL recommends investing for the medium to long term in securities that display the least amount of volatility in markets. To determine the volatility of securities, analysts employ a technique called the Dollar-Cost Averaging (“DCA”).

According to Investopedia, the DCA is the buying of a fixed dollar amount of a particular investment on a regular schedule, regardless of the share price. The investor purchases more shares when prices are low and fewer shares when prices are high. Investors must remember that all investments carry with it a level of risk therefore there is no technique that will guarantee that an investor won’t lose money on investments. Financial advisors favour the DCA technique of investing as it does not require a lump sum of money to begin with, but rather, encourages regular deposit of the same amount over time.

To understand this method further, we can illustrate how this technique materializes. Let us assume that Matthew decided to invest $10,000 in Apple on the first day of the month for the next three months, without the restrictions of trade fees, no minimum amount and purchasing only whole number shares. One the first month, the share price was $100, on the second, $95, and on the last month, $105. When the price increased, Matthew was able to purchase less shares with the same fixed investment amount. The opposite also held true, when the price fell, he was able to buy more shares with the same amount of money. In this example, Matthew purchased 300 shares at an average cost of $100. Given that the current price is $105, the original investment of $30,000 would now be worth $31,500.

If the investor had invested all $30,000 in one of those months instead of spreading the cost across three, the market value of the portfolio could either be higher or lower than the $31,500, subject to the month of investment. Since no-one can accurately predict the future share price of stocks, and time the market, DCA is a safer alternative strategy used by persons worldwide to hedge their risk in an attempt to lower their average price per share. This technique   eliminates the assumption that investors must have a large lump sum of money to invest and yields to more conservative, low income earners.


Possibly the World’s Biggest- Ever IPO

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National Association of Securities Dealers Automated Quotations Exchange (NASDAQ: NDAQ) is one of the leading providers of trading, clearing, exchange technology, listing, information and public company, services across all continents.

Nasdaq is contending for the flotation of the international listing of the world’s biggest Initial Public Offering (IPO) from a Saudi Arabian oil producer, Saudi Aramco in the second half of 2018.

Chief Executive Officer (CEO) Adena Friedman did not explicitly state, but alluded to their interest on Monday at the World Government Summit in Dubai when she stated “Companies want to be part of the future, they don’t necessarily want to be part of the past… We are extremely proud of all the companies that choose to come to Nasdaq, but we don’t comment on any specific issuer.”

Saudi Aramco is a state-owned oil company of the kingdom of Saudi Arabia, a fully integrated global petroleum and chemicals enterprise. Saudi Aramco’s oil and gas production infrastructure leads the industry in the scale of production, operational reliability and technical advances. Furthermore, the company is the world’s largest crude oil exporter, producing roughly one in every eight barrels of the world’s oil supply. The company aims to raise USD 100 billion from its planned IPO.

Aramco President and CEO, Amin Nasser, in an interview with Consumer News and Business Channel CNBC, said “It’s about evaluating all the information that is being passed to the government in terms of different markets that we have in terms of listed venues, whether it is in the U.K., or New York or Hong Kong or other markets,”.

According to Nasser, the New York Stock Exchange (NYSE) is at the top list of the Saudi Crown Prince Mohammed bin Salman, as it offers certain amenities such as international recognition, prestige and a much bigger pool of investors. Moreover, other options include listing the company on Saudi Arabian’s Tadawul Stock Exchange which has an affiliation with Nasdaq.

Possibly having the biggest IPO ever and being the largest oil/energy company, Saudi Aramco, if listed on NASDAQ, will turn heads around the world. With that being said, oil is a very volatile commodity, so despite very good credentials, this company should be watched very closely.


5 Money Topics to Discuss with Your Valentine

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One of the many viral stories closing out 2017 was of a man who after ten years of paying rent in the house he lives with his family, fell into a coma after he discovered that the landlord of the property and his wife were the same person! While making the rounds on social media, many commented: “how could he not know that his wife owned the house?”

This is not a totally unbelievable situation as money is a very challenging topic to discuss between couples. Many go to great lengths to avoid the topic altogether which can possibly result in expensive lessons and heartache. This Valentine’s day we are highlighting five topics all couples should discuss (not all at once!) over the length of their relationship.

Start with finding a quiet area free of distractions and journey into these important money- related topics:


You may want to retire at 50. What if your partner wants to work until the ripe old age of 70? Do you maintain separate retirement accounts or is it wiser to have one joint account? You can explore the idea of starting an investment account with SSL (shameless plug).


The pitter patter of little feet may be on the horizon for you two, but how many can you afford? Children are major financial commitments and couples should discuss what is possible rather than ‘would be nice’ before starting to expand the family.


Are you or your sweetheart in the process of paying student loans? Does the apple-of-your-eye have climbing credit card debt? If marriage is on the horizon then maybe a goal before saying ‘I do’ is to tackle outstanding debt together so you can begin the next phase of life with considerably more financial security.

True Passion

Your partner is their own person with passions and goals all of their own and so are you. Knowing what keeps them going and sharing what makes you feel may not only bring you two closer, but you can pool resources and agree on what direction you will take to achieve your passions.

Once your financial goals are shared, you can get to the fun part of planning! At SSL, we have products that can be suited to whatever you need. Our team of financial advisors can help you to plan your financial future through investing in local or international equities.


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The difference in yield between different types of bonds, for example between government bonds and corporate bonds. Also referred to as yield spread.


Good Job Wisynco!

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Being listed on the market for just over a month, Wisynco has already impressed investors with their first release of financial results.

These results presented were not only better than the same period in 2016, and not generated from normal operations but were also generated through weather conditions that impacted direct consumers.

The company reported net profit of $1.22 billion for the six months ended December 2017 or $0.34 cents per share. This is not only commendable, providing this was before listing, and their consumers’ businesses were significantly impacted by the rains, but it shows the quality of the company itself, showing that nothing can stop the company from growing.

For the three months ended December 2017, Net Profit rose to $578 million from $470 million in December 31, 2016, a 23 percent increase and earnings per share rose from $0.13 cents to $0.16 cents. Revenue generated by the company slightly exceeded $12.2 billion, with the last quarter creating the majority, with little over $6 billion. This shows an increase of $1.66 million or 15.7 percent for the six months, quarter over quarter.

Two months before listing, Wisynco got approval from the tax authorities for the transfer of three non-core operations to its parent. These operations include Wisynco Foods limited, Seville Development Limited and Fusion Limited, valued at about $1 billion after tax, which now falls under the Wisynco Group (Caribbean) Limited.

According to Mr. Mahfood, capital is being spent on recovery from the fire in 2016, which should be finished by the end of its financial year in June 2018. As such, the company will focus on controlling their cash.

The 2 billion dollar project involving the construction of cold-storage facilities, which is a part of the recovery, was also delayed due to inclement weather during summer but hopes to be finalised in the upcoming fourth quarter.

The company’s fixed assets have grown by $1.37 million or 37 percent  to $5.09 billion from $3.72 billion even through the recovery process. They listed on the market at $7.87 and is currently trading at $10.70, with an all-time high of just short of $14.00, which shows positive investor relations.

Quality vs Quantity- Apple

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Quantity producing is a strategy that Apple [NASDAQ: AAPL] is known for; they provide their client base with continuous updates year-over-year. But are these specific deadlines causing an uproar?

Quantity producing is not turning out so well for them.

There have been recent complaints about glitches and bugs in their software which, according to longtime customers, never used to happen when their customer base was smaller. They had feature-packed upgrades, some things rushed and some cut, causing delays in the release or inefficient updates. Apple is now putting in place a strategy to correct this, realising that they have been rushing and not meeting their deadlines.

These strategies that the company plans to implement will allow for engineers to have more time to work on features and refinements, than focusing on meeting annual requirements that seem to be rushed allowing for bug prone devices.

According to Bloomberg, the process is a huge cultural shock for engineers. They are used to quick turn-around with updates that keep loyal customers interested, which also shines the light on competitors to make them seem like they do not move as quickly.

What is coming next?

A single third-party app will be able to work on iPhones, Mac computers and iPods, the use of Apple’s iPhone apps on Mac and new characters for their popular Animojis, which will also be featured in the iPad. They also plan to integrate FaceTime and Animojis, allowing persons to use virtual faces, as well as potential FaceTime conferencing.

The first test will be their new software upgrade named ‘Peace’ which will most likely be called iOS 12.

In light of this, Apple has shifted its focus from quantity to quality produce. This is vital for customer satisfaction and company reputation. As such, despite loyalty to the company, some consumers have opted to switch from iPhone to Android, for ease of use and fewer issues, however, this will change their minds causing them to hold and see what Apple has in store for them.

Now that they are focusing on quality, are you excited to see what Apple Inc. has up their sleeves?

We shall see for the rest of 2018!



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A method of issuing securities whereby investors are invited to bid, subject to a minimum price. The allocation of the securities is made according to the prices bid.


YUM! Brands to Invest in GrubHub

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In early February, GrubHub’s stock price increased by an impressive 29 percent to US$89.04 per share after the company announced a US$200 million partnership with Yum! Brands and better than expected fourth quarter results.Yum! Brands is the parent company for Pizza Hut, KFC and Taco Bell and is the fourth- largest private employer in the United States.

Based on the agreement, GrubHub will be expanding its services to offer pickups and delivery services to customers at their doorsteps. GrubHub will also be working with Franchisees to implement ordering online and pickup services from Yum Brand subsidiaries. The multi million-dollar agreement also sees the appointment of Pizza Hut’s President, Arthur Starrs, to GrubHub’s Board of Directors for a period of three years .

You may be wondering what would make GrubHub stand out from other competing delivery business. GrubHub is expanding their coverage of delivery to include additional cities to the 900 it currently serves. GrubHub increased its restaurant count in two years; from 40,000 to 80,000 and is available in 1300 cities at the moment and looks to provide their service to a majority of all KFC and Taco Bell locations across the US in 2018.

GrubHub reported fourth quarter earnings of US$0.36 cents per share and a revenue of US$205.1 million. On the other hand, Yum! Brands stock price decreased by 4.7 percent following the announcement but their fourth quarter review was nonetheless better than expected.

Earnings per share for the quarter increased by 53 percent to US$1.26 and net income rose to US$436 million from US$303 million the previous quarter. Regrettably, total revenue for the year fell by 16.4 percent to US$1.58 billion.


Twitter Stock Gains

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For the first time in Twitter’s history the company has reported a net profit which caused the stock price to rise more than 15 percent on Thursday, currently at US$30.18. With this improvement analysts are even suggesting that Twitter may well be targeted as an acquisition.

For the fourth quarter, Twitter reported a modest revenue increase to US$731.6 million. Compared to a loss of US$167 million it experienced for the same period in 2016, the company is improving. Twitter currently generates revenue through video ad sales.

Earnings were US$0.19 cents per share, an increase from the US$0.14 cents that analysts predicted. Daily active users (DAU) increased by 12 percent,  EBITDA margins improved significantly from US$215 million in the previous year, which accounted for nearly a third of revenue, compared to US$308 million for 2017, which represented 42 percent of revenue.

Twitter blamed its lack of ability to increase its users on the fact that it had to rid the social media page of fake accounts, seasonality and purging the social media site from conspiracy theorists and white supremacists.

Twitter still has a long way to go if it wants to compete with social media giants like Facebook and Instagram. However, with its improvement in revenue and net profit, the company has positioned itself for greater things in 2018. For us though, Twitter is not a screaming buy.


Return on Equity (ROE)

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A method of valuation of company accounts which can determine how a company is spending its money, calculated by dividing a company’s net income by its stockholder equity.


The Sneaky Truth about Increasing Employment Rates

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Inflation and unemployment are two of the most important economic variables that affect the quality of our daily lives.

Based on the principles of supply and demand, the two have an inverse relationship, where a high unemployment rate, implicates a low inflation rate and vice versa.

The country’s unemployment rate, or the percentage of citizens of legal age to work who are not currently employed, is a vital rate used by governments to measure the health of a country’s economy.

In October 2017, Jamaica recorded its lowest unemployment rate in a decade at 10.4 percent which indicated that there have been positive changes in the performance of the economy.

Jamaicans are reeling at the fall in unemployment, especially since a large part of the fall is due to the rise in youth employment. However, it is essential to note that this fall in unemployment will eventually lead to a rise in inflation, and more significantly so if the unemployment rate falls below the natural rate of unemployment.

While an increase in the number of employed residents is something to cheer about, the country has to ensure that the pace of growth does not exceed a pace that cannot be sustained. An unemployment rate below the natural rate suggests that the economy is growing faster than its maximum sustainable rate in the short-term. This can create a domino effect which will see upward pressure on wages and prices, in general, leading to increased inflation.

This is evident in the upwards trend of the inflation rate between 2002 and 2017 where the average inflation rate was 9.41 percent. The latest recorded rate was 5.20 percent in October, which indicates a rise since the third quarter of the 2017.

Following a decade long record low rate in unemployment, Jamaicans must beware of the high possibility of rising prices. Inflation has negative impacts on every group in society and cannot be easily corrected.

It has been noted that the current international market slump is inducing  anxiety and fear among investors. Analysts theorise that the increase in wages in a tight U.S. labour market (forcing a rise in inflation) is one of the triggers for the fall in indices. Therefore, until the government is capable of reducing unemployment while keeping inflation rates low using stable monetary and fiscal policies, inflation is inevitable.



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The study of historical market data to determine trends and to try to predict future movements.


Is Snap Inc. Snapping Back?

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After a strong fourth quarter earnings report on Tuesday, shares of Snap Inc. (NYSE: SNAP) soared to US$20.61 from US$14.05 in two days, a 46.7 percent increase.

An impressive increase on paper but still a modest improvement as the stock has been trading below its IPO price of US$17.00 since July 2017.

Congratulations to Snap for increasing revenue and its user base for 2017 for the first time in history. The most positive news from the report is that the company is now making enough money to cover their necessary expenses.

Even though that is still not enough, Snap performed better than predicted. Analysts were predicting that the company’s revenue would amount to US$252.8 million but actual revenue for the fourth quarter is US$285.7 million. Additionally, the app now has 187 million active users.

Snap, however, had a net loss of US$350 million and an operating cash flow of a negative US$735 million for the entire year.  While boasting a gross margin of 33 percent is nothing spectacular when compared to other social media giants such as Facebook, which has an 88 percent gross margin for its fourth quarter and Twitter which had a 64 percent gross margin for their third-quarter reports, Snap is rather proud of its improvement and its prospects for 2018.

Snap’s costly expenses can be traced back to the company’s lack of ability in building its computer network to run its app. Instead, the company outsources the computer power from Google and Amazon Cloud. This outsourcing takes up 70 percent of Snaps expenses to run its app.

Snap generates revenue solely from ad sales. However, with competition from Facebook, Instagram and Twitter, Snap still struggles to increase its revenue to a point where its sustainable enough to compete. Moreover, it is somewhat tricky for Snap to expand its reach to many users as it is said that the app functions better with the more expensive and up to date smartphones in areas where the mobile internet speed is fast.

While we do not recommend investors to buy Snap Inc, it doesn’t hurt to be updated on the progress the company makes and hopefully that can continue as 2018 progresses.


Follow by Example: Learn from Experienced Investors

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There is no set method as to how one should invest. However, based on the recent decline in market prices, why not take a page out of the more experienced investor’s book?

What would they do in this situation?

Investors such as Ben Graham, Peter Lynch and Warren Buffett have been around for a while. They have experienced market crashes before but have also made significant wealth from investing.

The Conservative Investor

Ben Graham made his investment decisions mostly on the financial analysis of stocks. Graham focused on safe investments and was not much of a risk taker. He preferred to invest in stocks when the market price is below the company valuation to gain significantly if the market price should increase but in the case where the prices fell there would be some cushion for the stock.

The Aggressive Investor

Peter Lynch, on the other hand, is the complete opposite. His investment decisions are based on market sentiment. Additionally, he was a long-term investor and was not bothered by market corrections.

Lynch lived by several investment principles, namely:

(a)    Be aware of the stocks in your portfolio

(b)   Do not predict interest rates or the economy

(c)   Give yourself time to realise which companies are exceptional and which are not

(d)   Identify and purchase stocks where the company’s management is strong

(e)   Adapt to changes and do not make the same mistake twice

(f)    Know why you hold, sell or buy a stock

The Moderate Investor

With a net worth of US$89 billion over a career spanning over 70 years, Warren Buffett is one of the most respected and well-known investor in the US. Buffett prefers to invest in stocks with moats. Meaning the company’s ability to stay ahead of its competitors to continue making profits and increasing market shares. Buffett describes events in the market such as market correction as a positive for investors as it is a perfect opportunity to stock pick and takes advantage of low stock prices.

Which one are you?


Amazon to Start Delivery Service

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Amazon (NASDAQ: AMZN) is launching a delivery service whereby products are more readily available for faster delivery directly from sellers to customers. Sellers are said to be more inclined to use this service compared to others as Amazon sweetened the deal with low delivery costs, better logistics software and regular warehouse inspections.

This poses a challenge for competitors such as United Parcel Service Inc. (NYSE: UPS), and FedEx Corporation (NYSE: FDX), which provide similar service. However, Amazon still plans to use these delivery services as having different delivery options is better than relying on one, but Amazon will now get to decide how packages are sent rather than having the customer decide.

Initially, Amazon had announced that the delivery service was just a trial in October last year, but the company has realised that delivering packages on its own rather than depending on a third party is a more viable option and so far has seen the positive impacts it has had. Amazon will now be able to monitor deliveries right up until customers collect them. The company will also be able to save money through volume discounts, and since the delivery will be done directly from the seller’s warehouse to the customer, Amazon will no longer have to provide storage for the packages.

Amazon’s delivery service will also be beneficial to sellers as well. Amazon’s latest service, Fulfillment by Amazon (FBA), launched in 2006, allows sellers to ship their goods to Amazon warehouses for the company to process shipping when they come in. However, these sellers will be able to save money as they would not have to be paying Amazon the exorbitant storage and packing fees.

Amazon is finding innovative ways to increase and improve its service as they continue to expand their operation. Despite having a setback in its market price before releasing its earnings report, Amazon is still one of the top tech stock on the market and we continue to recommend this stock to investors.


Market Impact

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Market impact is a measure of each trade’s average execution price versus the volume weighted average price of the stock for that trading day. It is thus a measure of how the size of the order affects the price at which it is executed.


MedicanJa Ltd Looking at IPO

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MedicanJa Ltd has announced its intentions to list on the Jamaica Stock Exchange in a few weeks. At the helm of the company is Dr. Henry Lowe, a renowned Jamaican scientist who specialises in the development of edible products from Jamaican plants such as cannabis. He is optimistic that this listing will give Jamaicans at home and abroad the opportunity to earn money from their indirect involvement in medical marijuana through investments.

Lowe sees Jamaica as a future hub for medicinal plants as the island grows a majority of the world’s established medicinal plants that can be made into plant based medicinal products.

Marijuana is commercially unexploited in Jamaica. Despite extensive research conducted by the Biotech Research and Development Institute at the University of the West Indies, on its medicinal properties there seem to be very slow progress to changing the current situation. Lowe expressed that there are many possibilities for Jamaica in this area.

Lowe has been successful in making other medicinal plants into commercially accepted products. He has made quality products from bushes such as guinea hen weed, ball moss, moringa, bizzy and many other local products that have been around for many years.

The company has already received a license to operate from the Cannabis Licensing Authority and approval from the Ministry of Health to produce four topical and two oral products for sale.

MedicanJa Ltd was formed in 2013 and is a subsidiary of Eden Gardens Group. Other affiliates in the group include EG Wellness Brands, Bio Tech Research and Development Institute and FlavoCure Biotech LLC.

MedicanJa Ltd will now be a direct competitor to Lasvac, a new company formed by Lasco Manufacturing Ltd (JSE: LASM), which will also manufacture medicinal marijuana products in Jamaica.


After the Storm, Comes the Rainbow

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The past three trading days have wreaked havoc on the nerves of investors across the globe. The major sellout that took place on Friday, February 2, 2018, rolling over to the following Monday, saw significant loss in market indices.

What many feared was a market crash, was simply a market correction after a two-year period of appreciating of stock prices.

This phenomenon was not unexpected as analysts predicted that eventually, the market would have corrected itself.

Of course, other factors played a role in Tuesday’s panic, for example, the rising bonds yields which people assumed would lead to inflation and higher rates, and eventually erode companies’ profits.

Following the plunge of approximately 1500 points in the Dow Jones index, and the S&P 500 down by 0.9 percent, the market recovered the best they have since 2016 by the end of Tuesday.

The most affected industries such as technology, materials and consumer shares paced a 1.7 percent gain in the S&P 500 Index, while DowDuPont and Home Depot led a 567-point surge in the Dow Jones Industrial Average, the biggest gain in two years.

Notwithstanding the major losses from previous days, the market is starting to see and feel the efforts of investors to bring forth stability and return consumer confidence.

This last market correction does not indicate that investors should become complacent about markets’ volatility. We do believe that without solid economic growth, rising profits and a gradual pace of normalising policy by the central bank, this plunge is one we could experience again. Investors and traders must keep a keen eye on their holdings and the companies on which they have been bullish about for years.