INVALID LIVES may be Assured at rates proportioned to the risk. the General Principles of Land Investment. exemplified in the Cases of Freehold Land. Find 34 ways to say INVESTMENT, along with antonyms, related words, and example sentences at hurn.onnar.xyz, the world's most trusted free thesaurus. The companies identified and investment examples are for illustrative purposes only and should not be deemed a recommendation to purchase. FOREX IS AN INVESTMENT We will be at a standstill 1 approach into softphone that allows. The hood leading basics of how been provided with of the Firefox from underneath the work, that was drilling down from with connections to. Click it and.
History is full of companies that have built temporary advantages based on network effects that then fell. Moats are made of durable competitive advantages, and durability hinges on a number of factors, including:. The better any product with network effects can optimize its cost of user acquisition, capitalize on high switching costs, and increase engagement, the more likely it is to be able to maintain its user base and fend off competitors.
Amazon recognized early on that the more people in its network — both suppliers and customers — the lower the prices it could offer to buyers. Lower prices meant a better customer experience that attracted more customers; more customers attracted more sellers; more sellers meant a better selection of goods and prices; better goods and prices created a better customer experience; and so on.
Over time Amazon has expanded into new retail verticals, added features, and even created marketplaces that compete with its own marketplace — all in the pursuit of increasing user engagement and fueling a virtuous circle of growth. In the late s, Amazon first began expanding from books to other media products, like CDs, movies, and other electronics. A few years later, Marketplace launched, giving third-party sellers the ability to sell products alongside the Amazon listing.
While the Marketplace technically may have cannibalized Amazon sales, it served the purpose of the Amazon flywheel by reinforcing for customers that Amazon was the best and cheapest place to shop. Bringing in more customers through better functionality and growth into new verticals, Amazon used the growth that resulted to bring in more suppliers, who began to see Amazon as the best way to reach a global customer base and increase their revenues.
As of April , membership in the Prime program is over M worldwide. After improving its own back-end in order to better scale up its computing power, Amazon then was able to make that same power available to startups and other customers. Amazon continues to use its profits to lower prices, increase supply, and build a better customer experience — feeding the fundamental flywheel that helped it become the biggest online retailer in the world.
Immediately, the company lowered prices on high-volume Whole Foods items and threaded in Prime membership discounts. When Amazon enters a new market, it does so with its formidable scale, massive user base, and a willingness to duke it out in industries with razor-thin margins — a strategy that has allowed it to grow from a small bookseller to a true Everything Store.
The original OpenTable app for restaurants was essentially an electronic reservation book for restaurants that made the day-to-day work of turning over tables more straightforward and less error prone. The app also became the necessary foundation of the reservation tool that would follow, since so few restaurants had digitized back-ends.
When the OpenTable team successfully pitched restaurants on this software, they were also successfully pitching the idea of putting a networked computer inside the restaurant. The more restaurants OpenTable got to use that software, the more attractive the idea of an online reservation system became for both the demand and supply side of the marketplace. More restaurants meant more choice for consumers.
More choice attracted more consumers, which gave restaurants more business. The idea took off, and by the time OpenTable went public in , the company was claiming that a third of the 30, reservation-taking restaurants in America were OpenTable customers. OpenTable also benefitted from making its product a core part of everyday operations. The company put a proprietary software terminal in the thousands of restaurants that signed up to use the service.
That terminal became used for regular operations not just OpenTable , creating a significant barrier to entry for other companies hoping to edge into the restaurant reservation market. To give up OpenTable, a restaurant would have to toss out a major piece of infrastructure, not to mention a source of traffic. But even as new competitors emerge, OpenTable still has a big advantage when it comes to scale. For about a decade, OpenTable was essentially the only player in the restaurant reservation market, giving it a huge head start on acquiring customers and restaurants.
Early on, Uber attracted independent drivers the supply to its platform by offering a guaranteed source of customers. For drivers without a central dispatcher, it could be difficult to find fares, and drivers would often have to idle near hotels and airports to make their living. With Uber, those drivers could pick up fares at any time, giving them a way to make money during the dead time between pickups. At the same time, Uber attracted users demand by providing them with a guaranteed driver.
To ensure that a ride was always available when a potential fare opened the app, Uber used a model that would become known as surge pricing. During times of higher demand, prices on rides were raised, increasing the supply of drivers and increasing accessibility for the demand side. With every new driver that Uber added to the platform, the geographic reach of the app increased: there were more drivers in more places, meaning a shorter wait for a ride for Uber customers.
The shorter the wait for a ride, the more users that Uber could attract. The more users Uber attracted, the more drivers it attracted too — further decreasing time-to-ride and increasing geographic reach. When fighting Juno and Gett in New York City, for example, Uber simply upped its driver incentives and discounted rides for Uber customers.
That brought drivers — some of whom worked simultaneously for other services — back to Uber, where they could make more money. It also brought customers, who could easily use either service, back as well. That strategy has been less effective against Lyft , which has become increasingly able to offer similar incentives within its marketplace, competing with Uber on price and driver availability.
Ultimately, to win against Lyft, Uber is betting not only on its marketplace moat, but also reinvesting in its brand, hoping that its familiarity can give it an edge in a newly commodified rideshare industry. It is also investing in various other services and verticals including, such as freight shipping and food delivery. Airbnb harnesses the power of marketplace network effects by bringing together 4M hosts and tens of millions of guests.
Each new guest provides more business to the hosts and increases the incentive to list rentals. And as more hosts join the marketplace, they enhance the value of the system by providing travelers with more options to choose from and places to visit. Both groups are incentivized to stick with Airbnb. Positive experiences with Airbnb hosts keep guests using the platform for future trips, while accrued positive reviews help hosts attract more customers.
And with millions of users interacting on its platform, the company is able to gather valuable data. These insights then help the company to refine its products and deepen its relationship with users. In May , for instance, Airbnb laid off a quarter of its staff in a bid to cut costs amid the Covid pandemic. And Airbnb was perfectly positioned to profit from this demand.
Guests were able to choose from a wide range of options and booked for weeks and even months at a time. This boom in business allowed Airbnb to recover enough to even go public in December This relatively simple difference quickly made Google the dominant internet search engine. Another factor that makes Google attractive for advertisers is that so many searches are made with the intent to buy a good or service.
In , Google has about a The company also leverages its ability to constantly acquire new data about what people are searching for to improve search and build further moats in areas like transportation and shopping. The most powerful differentiator for Google here is that the company can pair search information with other data sources it has access to, like mobile location data from the Google app. The result is a layering of value.
When a user encounters a speed trap or slowdown, that information can then be transmitted to every other user of the app, making the experience better for everyone. This personalization makes users less likely to want to give up that convenience and go to another provider. Today, for example, more product searches begin on Amazon than do on Google.
The durability and stickiness of the Apple ecosystem comes down largely to iOS and the ways that it incentivizes users to stick around. A first major lever that Apple used to keep people in its ecosystem was iTunes. The offering kept users around by becoming their definitive system for digital music, as music bought on iTunes could only be listened to on iTunes.
Another level was iCloud, which became the clearinghouse for all personal data. On the hardware side, there are products like Apple TV and AirPods, which become more valuable when you have an iOS product to connect them to. Every new product and service in the Apple ecosystem is designed to drive value for people using iOS and reinforce the value of staying inside the ecosystem.
The result has been a significant diversification in the products that Apple sells in large numbers. The more friends a user had on Facebook, the more value the user could get out of it. But Facebook layered more and more value on top of this simple social register over time, and because it controlled all the data, the company gained control of a deep moat built on network effects. The first big feature Facebook added to its platform was Photos, which instantly became a powerful growth mechanism because of its tagging functionality.
Every time a user uploaded a new photo and tagged their friends, those people were notified about it. Not only did these notifications drive users to Facebook to see photos; it also taught new users how to use Facebook. Meanwhile, getting that notification teaches you that tagging photos is possible. Instead of Facebook explaining that you should upload photos and tag people, they just showed you. They created new triggers to bring new people into the Facebook ecosystem, such as receiving an invite to a private group or receiving a message request.
Instead of having to build a new product from scratch, Facebook can use its social graph to compete with virtually anyone — for example, by immediately releasing copycat features like Instagram Stories to a bigger base of users than Snapchat had overall. The moat has electric vehicles at its core. But the company has also built advanced software, offers a charging network, and sells complementary products like in-home energy storage and solar roofs.
For instance, Tesla has also built over 25, supercharger stations around the world that Morgan Stanley analyst Adam Jonas considers as a major strategic asset:. Tesla sees electric vehicles as a platform consisting of car buyers and rapid-charging stations. Selling electric cars only makes sense if drivers can charge them easily, but investing in a charging network is financially viable only with a large enough base of electric vehicles.
Tesla is tackling this riddle by building both the cars and the network at the same time. Other carmakers have taken a different approach. This fast-charging network is intended to serve electric vehicles in Europe but currently operates only a few hundred stations.
Tesla is ahead of the competition in other areas as well. Tesla pioneered over-the-air OTA software updates that can improve range, braking, power, and driver-assistance capabilities. The company also provides solar roofs, solar panels, and Powerwall home batteries. Musk is also keen on using his portfolio of other businesses to promote Tesla cars. For instance, SpaceX sent a Tesla Roadster into deep space as part of a demonstration for its Falcon Heavy rocket in The stunt is still generating headlines, such as when the car passed by Mars in October Both of these futuristic companies are frequently covered by the media and generate buzz on social platforms.
Many of the biggest and most durable business moats in history have been built on an advantage related to cost. Companies with an advantage on cost can generate several types of business moats, differentiated mainly by different approaches to consumer psychology. Switching cost moats exist when a company sells a product its users need or trust too much to switch providers.
A company with a switching cost moat can drive its prices and profits upward as long as the cost to the customer does not exceed the cost of switching to a competing provider. Even in cases where the cost does exceed the cost of switching, stickiness especially in enterprise products can help defend the moat. Sunk cost moats operate by eliciting a significant one-time or repeating payment from a customer, the size of which is big enough to dissuade that customer from leaving for a competitor later.
Cost advantage moats exist when companies build more efficient manufacturing or distribution and use that to offer lower prices than competitors. The power of this type of moat depends largely on how well those costs come down with scale. If a company can continually lower prices as they grow, it can create a self-perpetuating circle of massive growth. For more than 50 years, IBM held a competitive advantage built on fear. But it took time for the company to find the stability that would allow it to sell itself as the most reliable vendor in computing.
First, IBM had to invent a mainframe that would make it cost-effective for companies to stick with it over long periods of time. Either one would have required users to rewrite all their software. This was a massive problem for IBM from a business point of view, because it meant the company would have to prove itself again with each new iteration of computers that it manufactured. Customers could easily decide defect to a different mainframe provider, since buying a new IBM mainframe and going elsewhere cost the same amount of money.
To change that, IBM set out on a multi-year project to build a new, interoperable base mainframe — something that customers could upgrade to without having to rewrite all their software. Later, IBM could release updates onto that mainframe, allowing their customers to add more processing power without having to buy a whole new machine. A month after release, more than , were purchased around the world. Suddenly, choosing — and staying with — IBM became the logical decision for data centers and purchasing departments around the world.
Salespeople would explain to leads that they would never be criticized or questioned for sticking with IBM, and that their other peripherals and equipment might not work with a non-IBM mainframe. This strategy drove customers away from competitors and back to IBM. But none of it would ever have been possible if IBM had continued playing the same game it was playing in the early s, competing with other manufacturers to build the best possible mainframe with each new release cycle.
Automatic Data Processing ADP is one of the largest human resource management companies in the world, with over , clients around the world. It also has a deep switching cost moat that has given it a highly privileged position in its market. ADP has become indispensable to thousands of businesses around the world mainly because it handles two of the most mission-critical tasks inside an organization: payroll and taxes.
In addition to handling compliance and reporting, ADP offers various other value-add services like freelancer management , which further embed customers in the ADP ecosystem. One is that the cost advantage ADP once enjoyed has lessened, with new players like Gusto and Intuit emerging with lower-cost models designed to attract smaller companies and startups to their payroll platforms.
Slack uses high switching costs as a competitive moat. Companies rely on Slack to organize internal communications, manage projects, communicate with suppliers or customers, and more. This range makes switching from Slack to an alternative platform painful. Teams have to sacrifice workflow habits, message history, and chat channels while investing resources in learning a new tool. This increases the threshold for when any potential benefits of changing would outweigh the burden.
Slack is well aware of this competitive moat and is working hard to expand it. Slack has over 2, apps in its App Directory and boasts around , daily active registered developers. These integrations help users create new workflows that make leaving Slack even more challenging. Slack is also building new features to further increase its switching costs and network effects.
For instance, Slack Connect — introduced in June — allows users to collaborate with external organizations through Slack. Companies can bring their supply chain partners, industry peers, and corporate subsidiaries into a single channel to share files, negotiate deals, and make decisions.
The more work companies conduct in Slack, the harder it is for them to churn. Tech analyst Ben Thompson points out that:. Slack Connect allows organizations to collaborate on the messaging platform. Source: Dispatch. Slack will need to maintain and grow its moat as competitors such as Microsoft loom large. When Gillette first started selling its safety razors with disposable blades in , the innovation of replaceable blades immediately made shaving more convenient, eliminating the need to send razor blades for sharpening.
A low-margin product is priced low enough to attract as many people as possible, while a high-margin product is priced just high enough to create healthy profits. Repetition is the key here. After a customer makes the low-margin purchase, they must make the high-margin purchase continuously.
In other words, people who buy cheap Gillette razors tend to keep buying Gillette blades. Over time, because those customers keep generating high-margin revenue and have an in-built tendency to stick around, a moat is created. Protecting that moat means reinforcing the value of the product and the brand name, which Gillette has done largely through offering new products. New razor systems serve a dual purpose for Gillette.
First, they reinforce the value of the Gillette razor, encouraging people to maintain the investment they keep making in the products. Second, each iteration that increases the number of blades generates a new, more expensive blade that can drive more revenue. Gillette has also sought to protect its moat through advertising.
Since the s, Gillette has been one of the biggest names in advertising, especially through sponsorships of US sports. Instead, it priced both its razor and blades at a high cost. A hundred years after the first Gillette razors appeared on the market, Gillette was still the clear market leader in the space, selling about 5x as many razors as any other company.
One challenge is cultural. There is less social pressure to shave, for both men and women, than at virtually any time since Gillette was founded. The Covid pandemic also impacted Gillette. The company reported a drop in net sales as consumers shaved less during the pandemic.
Because these companies sell blades directly to consumers rather than primarily through retail, they have been able to sell at a lower cost than Gillette and other big-box competitors. Read Also: Metaphors for Hard Work. Imagine climbing a mountain for hours and hours with that goal in your mind of reaching the summit and looking down on the world with glee.
Once you get there you will have all those feelings that you might also have in other successful endeavors in your life, whether that be in love, sporting, money, or any other pursuit that you really put your heart and soul into. Another key analogy here is the number of small steps it takes as well as the persistence to climb a mountain. Read Also: Mountain Metaphors and Idioms. We often analogize success to being a ladder. Each step along the rung is another step toward the prize at the top.
A unicorn is a mythical being. You might also use this analogy to talk about the concept that someone is chasing something that they will never achieve. You might savor every bite. Read More: Cooking and Food Metaphors. We often visualize things as pyramids to look at how only very few people actually reach that peak — the top of the pyramid. It helps us visualize that idea that not everyone can be rich or happy or famous.
Only those who work the hardest and perhaps are the luckiest will get to the very top. The rest of us will languish together toward the bottom. You can never get to the end of a rainbow. It is used metaphorically to say that someone has made a lot of personal progress. You might use this saying when talking about someone who has done a fantastic job at something. Once the wave catches them, they can cruise at the top of the wave and enjoy the thrill.
But we use this idiom frequently in other situations to refer to anything that rewards you for your effort. Someone who rose to the occasion is a person who has performed well when they needed to. You would use this phrase after a performance sporting, musical, or other that is considered to have been a huge success. A win-win situation is a situation where everyone comes out successful! Many dogs chase busses, but not many catch them.
Imagine if a dog actually caught the bus it was chasing. What would it do? Bite it? Eat it? It would probably be confused and unsure about what the next step is. You could say it literally, such as when you put money into a stock in the stock market and pulled the money out after the stocks gained value. Another time you would use this phrase is when you put in a lot of effort and you got a reward from it.
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Usually, it is advisable to establish trades with an asymmetrical risk-reward ratio because, in that way, you can have a small win percentage and still be profitable. However, the goal should be defined based on the market structure and not at a random level. For example, if a long trade is getting closer to a resistance area, it would be good to take profits because a reversal to the downside is likely to happen. Nevertheless, it is important to keep in mind that the trading strategy defines how the profit targets will be managed.
Usually, some methods of profit-taking are:. Typically, the amount of risk is a percentage of the trading account. Generally, traders with higher account balances would go with a lower percentage. Look at it this way, if the size of your account increases, so too does your position. After the risk percentage is defined, and then the position size of the trade should be calculated.
In the next example, you should probably have an idea of how the calculation works out. Based on the trading strategy, the entry and stop-loss levels are defined. In this case, the long-entry is triggered based on the break of the bull flag. Where the difference between the entry and exit should be calculated. Subsequently, find the proper position size that represents the risk that you are willing to take.
The formula to find the position sizing results from dividing the risk in dollars by the difference between the entry and risk price. You should always diversify your portfolio because a bigger exposure to different markets and instruments will provide more trading opportunities. When interpreting diversification in trading risk management, it means you should not only stick to one trading strategy. Instead, prep yourself with the knowledge to handle trade-offs in case your position goes sideways.
Trading risk management works just fine for day traders. Though sometimes the intraday movements mixed with leverage are a double-edged sword because they can exponentially increase the profits and the losses. Therefore, if you are day trading, having a trading risk management system in place is a must because it will guarantee your capital the protection it needs. At the same time, you are protecting your position from liquidated. In the same way, it is advisable to diversify your day trading with a few strategies with the idea of decreasing the probability of risk of ruin.
The expected return can be measured in relation to the risk. Many professional traders use risk units to express the potential target and define if the trade is worth taking. Usually, the target zones are defined based on the market structure where supply and demand can be found. In a nutshell, a profitable trading strategy often looks for high-risk-reward ratio scenarios mixed with a reasonable win percentage. In that way, the profitable trades will offset the losing trades and leave substantial profit levels.
Usually, the equity curve of an efficient trading risk management system. It is normally smoother to the upside because the profit levels are broader. From a graphical perspective, you can see how the winning trades impulse the equity curve to the highs. According to the market research done by Motley Fool , cryptocurrency is one of the most volatile investment assets. Above all, how can you guarantee your funds to be safe in a crypto exchange?
And is your existing trading risk management sufficient? The cryptocurrency risks are primarily associated with the structure of the cryptocurrency market. What follows are three examples of cryptocurrency risks that hinder market progress:. Another critical risk with cryptocurrencies is the lack of clarity in terms of regulation and legal framework. Hence, finding trustworthy crypto exchanges and crypto wallets to have a secure trading environment. Usually, some of the best crypto exchanges have higher trading volumes where most people and institutions are trading.
That said, Bybit, as the top 5 crypto derivatives exchange , promises one of the best and most secure trading environments for crypto derivatives users. Take Bitcoin as an example; the blockchain technology behind the network acts as a distributed ledger or a public record of all transactions. The custody of the cryptocurrencies is done through digital wallets either a hot or cold wallet.
Still, they are susceptible to be hacked or destroyed. Paper wallets and hardware physical wallets are deemed the safest way to store all your digital assets. Bybit is the only cryptocurrency exchange that offers guaranteed compensation in case of any glitch in the system.
Bybit is also proud to provide an intuitive user experience with little to no connectivity issues due to our execution engine, which can process , transactions per second with Liquidity refers to the ease of entering and exiting the market without significant slippage. However, when an asset has low liquidity, it will not be easy to exit the position at the desired price. Slippage is when the order is executed at a different price than expected.
Usually, slippage occurs with cryptocurrencies that have low volume or high volatility. It signifies that the funds in this category have their principal at moderate risk. Instruments such as arbitrage funds , MIP funds, and hybrid debt-oriented funds are suited for a semi-conservative investor who intends to book decent profits at the same time wants to keep his risk limited.
Funds under this label are suited medium to the long-term investment horizon. It signifies that the funds in this category have their principal at moderately high risk. Usually, balanced equity-oriented funds, diversified equity funds, index funds and Gold ETFs are classified under this label. Products under this label are suited for investors seeking to create wealth over a long period. Investment in equity under such funds is related to the large-cap segment.
This label means that the funds in this category have their principal at high risk. Sectoral funds, thematic funds, international funds and micro-cap funds are a few examples of funds under this label. Products under this label are suited for investors seeking to create wealth over a long period of time and are fine with the high risk associated with their bet. Similar to the risk labels on the riskometer, investors can also be classified based on their ability to take risks in investments. See which band you fall into.
Since the universe of mutual funds is vast with hundreds of funds out there, investors can use the new riskometer to choose schemes which are in sync with their risk appetite. This meter is especially useful to investors who are new to the world of mutual funds and usually depend on the advice of their financial advisors.
However, However, it is essential to note that although the riskometer can give an overall idea of the risk level, there are many factors involved that should be considered while selecting a fund and a riskometer should not be the sole indicator. Hence, it is important to do your homework and judiciously make the decision regarding your investments.
Are you confused? With ClearTax , you can invest in the best performing mutual funds handpicked by experts. Annual turnover - In lacs. GST registered. Thank you for your response. Start investing now or. Download link sent. Mutual Fund Riskometer — How to measure risks? Updated on : Jan 13, - AM 08 min read. Start Investing Now. What is NPS? Tax Saving Made Simple.