Instavest Blog

Page 2

Hacking IPO Investing: Wall Street and the Crumbling of Chinese Walls

China Wall.png
The “Chinese wall” phenomenon is named – somewhat mysteriously – for the Great Wall of China (Severin Stalder)

The biggest financial firms of the world — like Morgan Stanley, J.P. Morgan, Goldman Sachs — are multifaceted entities, with many roles. They consult the financial activities of corporations and of individuals. They manage investment and issue recommendations, both to their clients individually, and in the form of public reports. They’re banks, which lend money, and store it at interest, and which underwrite (assume liability for) major fiscal events, like a company’s initial public offering (IPO) of stock on the public market.

This diversity of functions opens the door to many potential conflicts of interest. A firm could potentially abuse its influence in one branch to make money overall.

What has been called a “Chinese wall” is said to exist between the different sectors...

Continue reading →

Infographic: What can Mark Zuckerberg do with $45 billion?

Zuckerberg v003.jpg

View →

Immigrants and Refugees - Five Entrepreneurs That Made it in America

“Immigration has always been a key to America’s future. We are more than a country founded by immigrants. We are a country whose competitive strengths are in entrepreneurship and immigration. When you consider how many companies are founded by immigrants, you realize that immigration is fundamental to any long-term economic growth and prosperity. The high-skill immigration question is simple: Would you rather have more great technology companies here in the U.S. or abroad?” - Reid Hoffman, Co-Founder and Executive Chairman of LinkedIn, Partner at Greylock Partners

Located in Silicon Valley and with its roots in YCombinator, Instavest has seen first hand the diversity that flourishes in America. For this week, we’ve put together profiles of five notable immigrants, some of whom were refugees, from the technology and investing worlds:

Sergey Brin, Co-Founder of Google, President at...

Continue reading →

The Worst Advice Amateur Investors Receive

In most industries, going to a professional is the smartest thing you could do. If you are sick, you seek a doctor’s advice. If you want great photographs, you hire a professional photographer. Similarly, some would suggest in the investing world, going to a professional is the only smart option. Buyer beware. Unfortunately, amateur investors are receive terrible advice from so called “professionals.” Even great advice, can turn bad if it’s not properly understood. Here is clarification on a few pieces of advice.

Mutual fund managers can outperform amateur investors because they have more resources / time.
This assumption begins with the idea that mutual fund managers can outperform individuals when picking individual stocks. The problem is actively managed funds have a problem outperforming index funds, never mind individual investors. According to various studies, index funds...

Continue reading →

Sports betting vs. Daily Fantasy - Aren’t they both just gambling?

Much has been made of Daily Fantasy Sports sites in recent weeks, most recently highlighted by the New York Attorney General announcing that sites such as FanDuel and DraftKings are illegal based on state gambling laws.

Sports betting has been a long-standing activity - while most states deem it illegal, a few - namely Nevada - allow it. There is little contention that sports betting constitutes gambling - you bet against the odds and hope you get lucky. There’s a lot more controversy around FanDuel and DraftKings - the argument is that it should not fall under gambling laws because it is a skill based game, not chance.

Which is it then?

Unfortunately, in the United States, whether it’s skill or chance doesn’t matter much. Poker, with high stakes tournaments, is claimed by many to be a game of skill - many of the top players regularly out-play their competition. However, chance is...

Continue reading →

$1 Trillion Reasons Apple Wants In On This Market

When a company with an almost $650 billion market cap moves into a market, everyone else takes notice. Apple (NASDAQ: AAPL) is generating a lot of press, over its rumored peer-to-peer payments addition to Apple Pay. The peer-to-peer payments business is estimated to be a $1 trillion-dollar opportunity. For a company that just reported over $51 billion in revenue, this is the type of business that gets Apple investors excited. One stock that immediately took a hit on the news was PayPal Holdings (NASDAQ: PYPL), which dropped by less than 2%. Was the PayPal selloff warranted, and more importantly what does this mean for Apple investors?

Apple Pay with a Twist

Apple’s peer-to-peer service was actually mentioned as far back as July of this year, when the patent idea was unearthed. Apple Pay is accepted in over a million stores, and is growing in popularity, expanding into personal...

Continue reading →

5 Reasons to Invest the Money Sitting in your Bank Account

It may seem like a long time ago, but at one point an interest-bearing checking account may have paid 1.0% with a traditional savings account yielding as much as 3.0% annually. Investing in the stock market might seem attractive when a big jump in the Dow grabs headlines. But when the market drops significantly, some investors feel they are better off just leaving their money in a checking or savings account. Sure, a great of rule of thumb is to have 4-6 months of cash for emergencies. But stashing all your cash at the neighborhood Bank of America isn’t the optimal solution.

Here are 5 reasons to invest the money sitting in your bank account:

1. Adjusting for inflation, you’re actually losing money by leaving your money in a bank account.

Make your money work for you. Since World War II, the historical rate of inflation has been approximately 4.0%. Investors who worry about losses...

Continue reading →

Bitcoin: A Speculator’s Dilemma

Bitcoin has hit mainstream. Despite this, basic questions still remain - is it a currency or a commodity? Will governments support it? Will the banks eventually use it?

Bitcoin has been mired in debate since it’s inception. In August, within the developer community, a debate about Bitcoin’s architecture took place, and Bitcoin XT was born as a fork from the original project.

What’s certainly true is that Bitcoin has been extremely volatile, with many people around the world buying them on pure speculation that the price will rise. After breaking $1000/ BTC at the end of 2013, Bitcoin fell below $200/ BTC just over a year later. In the past month, it’s price has surged, breaking $400/ BTC for the first time since over one year ago. The problem is, it’s very difficult to predict Bitcoin movements or even identify the source of price fluctuations.

While it only tells bits and pieces...

Continue reading →

Six Best Personal Finance Podcasters on the Internet


We at Instavest scoured the Internet for the best personal finance podcasts and we didn’t stop there. Sure, investing is important, but we were also very interested in why people chose to start a personal finance podcast. While each podcaster had a different story, two common themes emerged:

  • First, the podcasters demonstrated a ridiculous passion for personal finance.
  • Second, they had a burning desire to help people achieve financial independence.

Without further ado, here are our top five personal finance podcasters:

Andrew Fiebert, Listen Money Matters


Andrew Fiebert is a boss and his story is fascinating. When Andrew started making money after college, he wanted maximum “bang for his buck.” Unfortunately, there weren’t many good places to learn about personal finance at the time.

So, Andrew scratched his own itch and decided to build what was missing. Paul Graham...

Continue reading →

Sponsoring James Bond: 007’s Branding Sweepstakes

“As ever in the run-up to a Bond movie’s release, we’ve heard as much about Spectre’s sponsors as its stars.” - BBC October 1st, 2015

James Bond v001.jpg

Marketing effectiveness has been known to be notoriously hard to track. A 2015 study by Adobe (NASDAQ:ADBE) stated that nearly 80% of companies consider themselves ineffective at measuring mobile ROI and 92% unable to determine ROI from their social media. The flip side of that is branding - A Wall Street Journal article stated, “To a large extent, many companies are defined by their reputation. A good reputation and a strong brand allow companies to stand out in crowded markets.” For luxury brands, their brand may be their most important commodity.

Enter the world of James Bond. 007’s movies attract some of the most aggressive promotions in the movie business. The latest Bond film, Spectre, had a budget of $350 million - advertising partners cover a...

Continue reading →