x̄ - > Businesses' success will indeed be influenced by their data culture.

As enterprises enter the final month of 2021 and prepare to bring in the new year, the data culture remains strong. For many, 2021 will remain a year of uncertainty as the epidemic continues to wreak havoc on plans, particularly for businesses hoping to reopen their doors. Nonetheless, the majority of firms have come to terms with the truth. Hybrid and remote work is the way of the future, and they have no choice but to embrace it. Organizations are embracing new and unexpected approaches to addressing workplace difficulties, and now is an excellent time for executives to commit to data-driven initiatives for better agility. According to a Future of Work Study 2021, 83 percent of workers polled globally believe a hybrid working model would be ideal. In fact, 63 percent of high-growth companies have enabled productivity anywhere in their workforce models. And this model can only be implemented if the organization believes in and practices a data-first culture. Adapting to new methods of working and interacting with a remote workforce has allowed firms to imagine fresh and unexpected solutions to workplace difficulties. According to a recent survey commissioned by Tableau, business leaders in the region (Australia, Japan, and Singapore) who were deliberate in increasing their data use during the Covid-19 pandemic were more than twice as likely to report positive changes in workplace decision making and communication as those who weren't. The deliberate use of data may assist firms in being nimble and connecting with today's scattered workforce. In the current online headquarter, data-driven discussions will produce business outcomes. Offices have moved online to establish their own digital headquarters. Even when work settings go online, they must be smoothly connected in order to support the way people typically communicate. And that is why, in order to make data more actionable, available, and intelligent, Tableau recently implemented advanced analytics tools straight into the workplace collaboration application Slack. Tableau anticipates increasing innovation in how analytics is incorporated into everyday work tools to help workers connect with data as more firms embrace the digital HQ model. Because of the uncertainty produced by the Covid-19 epidemic, this is an excellent time for managers to commit to data-driven solutions for better agility. Which is why an organization-wide data culture is crucial – it refers to the behaviors of individuals who respect, practice, and promote data usage. It necessitates that firms develop a data-driven culture, with the idea that data must be accessible to all employees. Companies must have the following components in place: Engagement - where data is viewed as a major strategic asset and employees are dedicated to maximizing its value. Leaders must take the first step and set a good example. Security - Possessing equal leadership trust and visible access to managed, correct data results in increased employee responsibility and accountability for the data utilized and required. Value and acknowledge specific type of data as a component of how firms attract, develop, and retain employees. Share entails establishing settings, such as internal communities, in which individuals share and assist one another in order to achieve common goals. Perspective — fostering curiosity via data inquiry and even failure Having said that, the business forecast for 2022 remains broad and open. However, one thing is almost certain: firms already have had two years to adapt to change and become accustomed to blended and faraway working methods. If they're really unsure, they should start evaluating their company plans.

x̄ - > Happy New Year

 

x̄ - > The role of tech companies in amplifying misinformation and disinformation that surrounds the covid-19 pandemic among others.

 What exactly was wrong? Suspicions, misinformation, and extreme fanaticism have flourished as a result of the COVID-19 outbreak. Increasingly individuals have already been spending time with family and online during the shutdown and with increased unemployment, exposing themselves to incorrect information and terrible extremist narratives. Websites like 4Chan or Reddit, as well as more major social media sites like Facebook, Twitter, and YouTube, are hotspots for propagating and distributing misinformation. What exactly is the issue?

In order to promote social resilience, it is critical, especially in the COVID-19 environment, to guarantee that today's digital generations are trained to spot hateful extremism and false narratives. To inform primary research, decision making and it is necessary to combine previous research, comprehend the evidence base, and rectify inadequacies.

During COVID-19, the Commission for Countering Extremism (CCE) commissioned Ipsos Mori and RAND Europe to conduct research on hateful extremism in society. RAND Europe undertook a study of the literature to look into the linkages between hateful extremism and misleading information, as well as the online interventions and policy responses that go along with it.

A Rapid Evidence Assessment (REA) was employed by the study team, which includes an evaluation of 93 relevant publications from a variety of fields, including psychology, political science, sociology, and law.

Misinformation may influence hostile extreme attitudes and behaviors by creating safe spaces and increasing hate crimes.

Increased exposure and recruiting benefits incentivize hateful radicals to promote misinformation and conspiracy theories.

Hateful extremist actors usually focus their narratives on 'out-groups,' although the epidemic is framed differently in each story.

Although there is minimal empirical evidence on the effect of online interventions, the literature shows the fact-checking, counter-speech, takedowns, and education are successful.

A list of recommendations for such design and implementation of future interventions may be found in the evaluated literature:

Authorities should devote more resources to combating misleading information in an attempt to strengthen community resiliency, according to reports, as well as undertake or commission a further study on the effects of vile extremist narratives.

Firms like Facebook as well as media companies are also being pushed to take more responsibility by regulating content on various platforms including guaranteeing those media follow proper journalistic ethics (e.g. avoiding clickbait headlines).

Funding in research may contribute to closing out evidence gaps and strengthening the response to false information & destructive extremist ideologies.

Keeping digital companies accountable can make them more receptive to misleading information and ugly fanaticism.

Investing in education can help people become more aware of the hazards of false information and hateful extremism.

actually collecting and disseminating data on indications of hateful extremism might help policymakers improve their responses.

Collaboration across sectors might help to ensure that initiatives reinforce each other.

The research identifies areas that may benefit from more investigation and inquiry based on the evidentiary gaps identified.

Assessments of current therapies that are independent and well-designed.

The study of 'directed motives' (a person's proclivity to maintain current views).

Research has a greater geographic, linguistic, and internet content scope.

x̄ - > Mountain Bike Gear Essentials to Get You Started

Whether you’ve been mountain biking a few times or you’re setting out on your very first ride, you’re definitely not alone. Since the 2020 bike craze, more and more women have been branching out into the mountain biking world and trying this fast-paced outdoor sport.
However, like many outdoor sports, the price of entry can be hefty when you count the bike, helmet, tools, and other essentials. It can also be challenging to decipher what’s absolutely necessary for a ride and what you may be able to do without as you get to know the sport.
To help you get started, we chatted with several women mountain bikers who’ve spent countless hours on the trails. We got their tips on where to start when it comes to the trail and your mountain bike gear.
On the trail:
Because of the recent rise in women’s mountain biking, all our sources mentioned trying a women’s riding group, lessons, or otherwise finding good people to ride with. More and more women’s riding groups are cropping up everywhere, so if you don’t see one near you off the bat, ask your local bike shop if they know of any in your area.
While everyone has their own preference, these riding groups can help you meet a community, share knowledge, and provide inspiration for what you can do as a rider.
“Riding with people who are fun and supportive is key!” says pro rider, artist, and advocate, Brooklyn Bell. “Riding with good people helps keep things safe and gives new riders space to learn and progress.”
The Gear:
 In other words, you don’t need the most current trail bike or a lot of new fancy gear to ride. 
“As you’re getting into the sport, you can use what you have, figure out what works and what doesn’t, and get what you need as you go,” Levine says.
That being said, there are a few pieces of gear that are essential and some that will greatly improve your riding experience. Most important? A helmet and a bike. If you’re looking to invest a little more in your ride, we suggest starting with: knee pads, a chamois (butt padding or “shammy”), saddle, shoes, pedals, sunglasses, and pack.
Helmets
All of our sources emphasized that a new, well-fitting, helmet is the single most important piece of gear you’ll use.
“You can wear whatever you want, but you should not ride a bike without a helmet on,” 
If you want to splurge for anything when it comes to your mountain bike gear, your helmet is the piece to shell out for. Many riders recommend investing in a mountain bike-specific helmet with MIPS (Multi-directional Impact Protection System) because these helmets add a bit more protection for your head.

x̄ - > How to make your bed - why is it important?

 

Slipping into a well-made bed is a reward at the end of a long day.

But many of us give more thought to constructing a great sandwich than to layering the right components for a bed that is comfy and cozy, that looks stylish and inviting, and that doesn’t have the sheets all scrunched up at the bottom.

Yes, some people seem to be able to fall asleep on anything. “But most of us need a comfortable setup, and bedding is so important in getting a good night’s sleep,” says Keith Cushner, product expert at sleepfoundation.org. “If you are uncomfortable, you just won’t sleep well.”

We asked three experts — a bedding designer, a cleaning expert, and an interior designer — to weigh in on setting up and maintaining a stylish, comfortable bed. Here’s what they had to say.

The basics: Bed-Making and Caring 101

First things first: Do you know how to make your bed? Melissa Homer, chief cleaning officer at MaidPro, offered the following tips to help you get your sheets, pillows, and blankets just right.

Experts choose the sheets they love best

Start with the fitted sheet, hooking the pockets as far as they will go over each corner of the mattress, beginning in the most difficult corner to reach if the bed is pushed against the walls. Then lay out the top sheet — if you still use one — with the patterned/finished side facing down, because it will give things a more finished look when you fold back the sheet.

If you like to add blankets, lay them on top of the sheet, then fold back the top of the sheet six to eight inches and tuck it tightly under the mattress on three sides. Spread your comforter, duvet or bedspread over the bed and smooth it out.

Put pillows in pillowcases and fluff and smooth them. If you just have sleeping pillows, place them flat at the top of the bed. If you have decorative pillows, place the sleeping pillows upright and layer the decorative pillows in front, from largest to smallest, in a symmetrical, centered pattern.

Homer says you can get away with washing sheets twice a month — unless you are someone who sweats a lot, eats in bed or has pets. Then, go for weekly washing. “Modern detergents are designed to get you excellent results in cold water, but the ideal temperature is warm,” she says. Always read the washing instructions before you buy. “If you have unpredictable members of your household, such as pets or children, do not buy anything for your bed that can’t go into the washing machine,” Homer says.

Decorating on a budget, bit by bit? Here's what these designers would do.

Spring for new mattress covers when you get a new mattress or if yours show signs of wear. “It’s the number one step to make sure your investment lasts as long as possible,” Homer says. Find one that protects against bedbugs, allergens, vomit, spills from drinking or snacking in bed and child accidents. She recommends encasement covers, which shield the mattress. “They used to be rubbery and noisy, but now they feel like nothing,” she says. She likes the SureGuard mattress encasement ($49.97 for the queen size, Amazon) for both mattress and box spring. (Yes, it’s a good idea to also cover your box spring if you have one.)

Wash poly-fill pillows every six to 12 months, Homer says, and use dryer balls when drying. “Dryer balls gently whack into the bedding as it tumbles, breaking apart clumps of down and stuffing, so they dry fluffy instead of lumpy,” she says. Follow the manufacturer’s instructions on cleaning for memory foam, down and other specialty pillows, because some can only be spot-cleaned. Don’t forget to wash pillow protectors, too, Homer says, such as these waterproof ones by SureGuard ($27.97 a pair, Amazon).

If you struggle with a messy bed every morning and love tightly tucked sheets, Homer suggests using mattress suspenders (RayTour bedsheet straps $9.96, Amazon), which clip under your mattress and can anchor multiple layers of bedding at once.

Fun fact: You don’t have to make your bed as soon as you get up. In fact, it’s better not to. “Turn down your bed in the morning, and make your bed after breakfast,” Homer says. “Give your bed a chance to air out. Open your blinds for the sunshine to come in.” Let the moisture from sweat dry out. “This will reduce allergens and dust mite colonies and won’t make your bed into a breeding ground for things that don’t make it smell so fresh,” she adds.

Essential bedding building blocks

“It’s so important that people spend the time and energy to think about how to create and invest in a comfortable sleep experience,” says Ariel Kaye, founder and chief executive of Parachute, maker of stylish sheets, quilts, duvet covers and other bedroom essentials. “You will spend a third of your life in bed.”

False thread counts and other things to look out for when buying sheets

After a mattress, pillows are the most important element in building a dreamy place to sleep. There are many varieties, including down, down alternative, memory foam, poly fill and buckwheat. Some unzip, so you can adjust the level of fill to your comfort level. Many pillows are marked for firmness, density or “loft.” Standard-size bed pillows (20 by 26 inches) are the typical choice; for a king-size bed, you might want a longer pillow (20 by 36 inches).

Kaye says she is a “maximalist” and likes to have one medium pillow and one firm. “Then I can layer them depending on what position I end up sleeping in,” she says. Side sleepers usually like a firmer and higher style to help them take the strain off their head, neck and back. Stomach sleepers might prefer a thinner version. “A super plump pillow forces a stomach sleeper’s head into a pinched angle,” Kaye says. She likes to add 26-inch European square pillows either in front of or behind sleeping pillows. “They add a nice polished look and are functional for reading, watching TV or working in bed,” she says.

Start with two sets of sheets, so you have one for the bed while the other is in the wash. Kaye likes the classic choice, percale, which she says has “more of a cool hand feel.” The Parachute line also includes brushed cotton, which feels “worn in like a T-shirt”; a smooth sateen with a warmer feel; and linen, which is heavier but still breathable. Kaye says thread counts are often just marketing gimmicks. “Anything over 400 is really not necessary” she says.

Go for a comforter or duvet if you like more warmth; a blanket or quilt are lighter option, Kaye says. “I like to transition my bed between seasons by adding or subtracting layers,” she says.

Styling a well-dressed bed

Dressing up your bed is a lot like dressing up yourself, says Melissa Sanabria, founder of D.C. design firm Sanabria & Co. Layering is key. The price of layers adds up, though, so when you choose bedding, you may have to start with the basics, then add decorative elements, such as throws, shams and quilts, over time.

Love your silky white sheets? Here's how to make them last.

“When I was a broke college student, I always invested in the best sheets I could afford, as that is the first layer that touches your skin,” Sanabria says. For the top layer, she prefers duvets, which can be changed up with new covers. She recommends neutrals such as white or tan for duvets or blankets, and she adds various colors and textures with accessories.

When it comes to pillows, don’t go overboard. On a queen-size bed, Sanabria starts with two sleeping pillows, then two pillows with coordinating shams. Add two decorative square pillows, such as Crate and Barrel’s Eyelash pillow covers ($29.95) or West Elm’s Cotton Linen & Velvet Corners cover ($42.50). Buy pillow inserts that are at least one inch larger than the covers, so you get a really full look, she says.

Sanabria recommends finishing the top of the bed with a “nice, long, skinny lumbar pillow” that you center between the two decorative square pillows.

“The lumbar pillow gives you some visual interest and is also good if you are reading and need additional support. I use mine a lot to prop up my computer,” Sanabria says. She likes this Hearth & Hand colorblock version from Target ($29.99) or the Icelandic shorn sheepskin pillow from CB2 ($139).

The final touch is a blanket, bedspread or quilt for the foot of the bed. Avoid ones that are marked “throw,” because they will be too small and won’t drape across the entire end of the bed, Sanabria says, or even cover your feet when you pull it up to take a nap. She suggests the European flax blanket from West Elm ($200 for a full/queen.) “This is a great extra layer, looks pretty and is also another opportunity for color or pattern on your bed,” she says.

x̄ - > How young is too young for social media? Behavioral scientists are closer to an answer.

 How young is too young for social media? Behavioral scientists are closer to an answer.

Recent literature has put the spotlight on how technology and social media are molding the next generation, and the consensus seems to be that it’s a sharp double-edged sword.
New research published in Computers in Human Behavior is no exception. The study, led by faculty at Wellesley Centers for Women, found that joining social media—specifically, Snapchat and Instagram—before age 11 was significantly linked to more “problematic digital behaviors” compared to those who joined the platforms when they were older.
The team surveyed over 750 middle schoolers in the Northeast United States and found that those who joined these platforms at or below the age 10 had more internet buddies that parents would disapprove of, and visited more social websites that were similarly frowned upon. They also showed more “unsympathetic online behaviors” and were more likely to become victims of online bullying or harassment. Altogether, it was a jumble of problematic digital moods.
Of course, that might not be news to social media giant Facebook; a recent trove of leaks in the Wall Street Journal revealed how the platform was aware for some time that it was “toxic” for teen girls, and also detailed its ambitions to lure tweens and pre-teens with targeted kid-specific products. Like almost all social media, including Twitter and TikTok, Facebook’s rules require users to be at least 13 years old to join. However, people who sign up self-report their own dates of birth, so it’s hardly an effective firewall—and by common sense, it’s nearly a given that packs of rogue children are roaming the social media universe.
In fact, “one-third of our sample had already started using social media at age 11 or 12 and another one-third had begun at age 10 or younger,” study author Linda Charmaraman said in a statement. But that doesn’t mean it’s a lost cause. The study’s findings also suggest parents can combat the harmful impacts by limiting how often their kids check social media or restricting phone usage; participants who reported such parental controls showed lessened negative effects.
And it’s not all bad: According to the research, those who joined social media before age 11 also showed greater civic engagement within the online community—such as posting supportive content or fostering events and activism for social issues—perhaps as their socialization at a younger age helped them grasp both the positive and negative potentials of such platforms. Also, regardless of when they joined social media, early adolescents displayed more positive digital behaviors overall than negative ones.
Reached for comment about the study, a Snapchat spokesperson said the platform “is designed to be used by young people ages 13+, which is why we prohibit the app being used by kids, do not market to that age group, and will not make a specific product for them.”
We also reached out to Instagram and will update this post if we hear back.
As the first children raised in the social-media era grow into their 20s and 30s, the effects of the internet revolution will likely become more profound—and we can expect that the need to understand how tech shapes kids in their most impressionable years will only become more urgent.

Linda Bahati

This work is licensed under a Creative Commons Attribution 4.0 International License.

x̄ - > Explainer-What's the difference between 1.5°C and 2°C of global warming?

GLASGOW, Nov 8 (Reuters) - Over and over at the U.N. climate summit in Glasgow, world leaders have stressed the need to limit global warming to 1.5 degrees Celsius.
The 2015 Paris Agreement commits countries to limit the global average temperature rise to well below 2°C above pre-industrial levels, and to aim for 1.5°C.
Scientists have said crossing the 1.5°C threshold risks unleashing far more severe climate change effects on people, wildlife, and ecosystems.
Preventing it requires almost halving global CO2 emissions by 2030 from 2010 levels and cutting them to net zero by 2050 -- an ambitious task that scientists, financiers, negotiators, and activists at COP26 are debating how to achieve and pay for.
But what is the difference between 1.5°C and 2°C of warming? We asked several scientists to explain:
WHERE ARE WE NOW?
Already, the world has heated to around 1.1°C above pre-industrial levels. Each of the last four decades was hotter than any decade since 1850.
"We never had such a global warming is only a few decades", said climate scientist Daniela Jacob at the Climate Service Center Germany. "Half a degree means much more extreme weather, and it can be more often, more intense, or extended in duration."
Just this year, torrential rains flooded China and Western Europe, killing hundreds of people. Hundreds more died when temperatures in the Pacific Northwest hit record highs. Greenland saw massive melting events, wildfires ravaged the Mediterranean and Siberia, and record drought-hit parts of Brazil.
"Climate change is already affecting every inhabited region across the globe," said climate scientist Rachel Warren at the University of East Anglia.
HEAT, RAIN, DROUGHT
More warming to 1.5°C and beyond will worsen such impacts.
"For every increment of global warming, changes in extremes become larger," said climate scientist Sonia Seneviratne at ETH Zurich.
For example, heatwaves would become both more frequent and more severe.
An extreme heat event that occurred once per decade in a climate without human influence, would happen 4.1 times a decade at 1.5°C of warming, and 5.6 times at 2°C, according to the U.N. climate science panel (IPCC).
Let warming spiral to 4°C, and such an event could occur 9.4 times per decade.
A warmer atmosphere can also hold more moisture, resulting in more extreme rainfall that raises flood risks. It also increases evaporation, leading to more intense droughts.
The difference between 1.5°C and 2°C is critical for Earth's oceans and frozen regions.
"At 1.5°C, there’s a good chance we can prevent most of Greenland and West Antarctic ice sheet from collapsing," said climate scientist Michael Mann at Pennsylvania State University.
That would help limit sea-level rise to a few feet by the end of the century - still, a big change that would erode coastlines and inundate some small island states and coastal cities.
But blow past 2°C and the ice sheets could collapse, Mann said, with sea levels rising up to 10 meters (30 feet)- though how quickly that could happen is uncertain.
Warming of 1.5°C would destroy at least 70% of coral reefs, but at 2°C more than 99% would be lost. That would destroy fish habitats and communities that rely on reefs for their food and livelihoods.
FOOD, FORESTS, DISEASE
Warming of 2°C, versus 1.5°C, would also increase the impact on food production.
"If you have crop failures in a couple of the breadbaskets of the world at the same time, then you could see extreme food price spikes and hunger and famine across wide swathes of the world," said climate scientist Simon Lewis at University College London.
A warmer world could see the mosquitoes that carry diseases such as malaria and dengue fever expand across a wider range. But 2°C would also see a bigger share of insects and animals lose most of their habitat range, compared with 1.5°C, and increase the risk of forest fires - another risk to wildlife.
'TIPPING POINTS
As the world heats up, the risk increases that the planet will reach "tipping points", where Earth’s systems cross a threshold that triggers irreversible or cascading impacts. Exactly when those points would be reached is uncertain.
Droughts, reduced rainfall, and continued destruction of the Amazon through deforestation, for example, could see the rainforest system collapse, releasing CO2 into the atmosphere rather than storing it. Or warming Arctic permafrost could cause long-frozen biomass to decompose, releasing a vast amount of carbon emissions.
"That's why it's so risky to keep emitting from fossil fuels ... because we're increasing the likelihood that we go over one of those tipping points," Lewis said.
BEYOND 2°C
So far, the climate pledges that countries have submitted to the United Nations' registry of pledges put the world on track for 2.7°C of warming. The International Energy Agency said Thursday that new promises announced at the COP26 summit - if implemented - could hold warming to below 1.8°C, although some experts challenged that calculation. It remains to be seen whether those promises will translate into real-world action. read more
Warming of 2.7°C would deliver "unliveable heat" for parts of the year across areas of the tropics and subtropics. Biodiversity would be enormously depleted, food security would drop, and extreme weather would exceed most urban infrastructure's capacity to cope, scientists said.
"If we can keep warming below 3°C we likely remain within our adaptive capacity as a civilization, but at 2.7°C warmings we would experience great hardship," said Mann.

x̄ - > Blockchain metaverse startups: Unparalleled investment potential

Neal Stephenson, a popular sci-fi writer coined the phrase “metaverse” in his first best-selling and breakthrough 1992 novel, Snow Crash. Now that concept is becoming a reality, and what’s more, you can invest in the metaverses. In Ready Player One, The OASIS is another example of an advanced virtual reality. Numerous other sci-fi authors, such as Ian M Banks, have created and used similar concepts within their novels.

Back in September, Facebook CEO Mark Zuckerberg was clearly interested in advancing the metaverse. In a recent earnings call, Facebook made it clear that they want to unify communities, creators, and eCommerce in the metaverse with Zuckerberg saying:

“Our overarching goal across all of these initiatives is to help bring the metaverse to life.”

And just last week Facebook rebranded to Meta and announced its plans to develop the “Metaverse.”

How big could metaverses become?

Already there are numerous household names making serious money in this space such as Roblox and Fortnite. These are complete virtual reality worlds where users exist through avatars. Slightly less well-known examples of virtual realities include Decentraland, Upland, and Sandbox, as well as Victoria VR which is another platform that will launch soon.

From an investment perspective, we can confidently say that this explosion in virtual reality and metaverses is comparable to the dot-com boom of the late 1990s. What we are witnessing now is the next phase of the internet being created, with metaverses potentially set to overtake and replace the web as it currently exists.

Related: New industry, new rules: Building the Metaverse without bias

Already some of the companies in this space such as Fortnite could sustain growth until they are comfortably sitting alongside Facebook, Google, Amazon, and other tech giants. Epic Games, the creators of Fortnite, recently raised $1 billion with Sony pouring $200 million into that funding round. Facebook is putting a lot of resources and money behind a new workplace and proto-metaverse VR platform known as Horizon.

Brands are also betting big on virtual reality. Some brands are already selling direct to avatars (D2A), or Gucci sells a virtual bag that costs more than a real one. Nike sells virtual Jordans in Fortnite and Coca-Cola started selling virtual wearables in Decentraland.

Bloomberg has estimated that the size of the metaverse market is worth $800 billion. Even though this is in its formative stage, savvy crypto investors can contribute to the growth of metaverses and trade in the tokens of high-growth startups.

x̄ - > Dov Gertzulin’s DG Capital Portfolio: Top 10 Stocks

In this article, we discuss the top 10 stocks in Dov Gertzulin's portfolio. If you want to skip our detailed analysis of Gertzulin's history, investment philosophy, and hedge fund performance, go directly to Dov Gertzulin's Portfolio: Top 5 Stocks.
Serving as its portfolio manager, Dov Gertzulin is the founder of the New York-based investment firm, DG Capital Management, specializing in middle-market opportunities across the capital structure, with a focus on distressed securities and reorganized equity. After earning his BBA from Baruch College and his M.B.A from New York University’s Stern School of Business, Gertzulin began his career in finance and asset management. Prior to establishing DG Capital Management in 2007, he served as a research analyst at JDS Capital Management. He later joined Neuberger Berman as a portfolio manager, where he co‐managed over $4 billion in assets.
Some of the most notable stocks present in the investment portfolio of DG Capital Management at the end of the second quarter of 2021 include United Therapeutics Corporation (NASDAQ:UTHR), Horizon Therapeutics Public Limited Company (NASDAQ: HZNP), and Caesars Entertainment, Inc. (NASDAQ:CZR), among others discussed in detail below.
George Drachas The Uncomplicated Guide to Investing drachas.com
Our Methodology
With this context, let us now analyze the top 10 stocks in Dov Gertzulin's portfolio. We looked into DG Capital Management's 13F portfolio for the second quarter for this list.
Why should we pay attention to Dov Gertzulin's stocks? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 86 percentage points since March 2017. Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Story continues
10. Brinker International, Inc. (NYSE:EAT)
DG Capital Management's Stake Value: $15.9 million
Percentage of DG Capital Management's 13F Portfolio: 3.45%
Number of Hedge Fund Holders: 31
Based in Texas, Brinker International, Inc. (NYSE:EAT) is one of the world’s leading restaurant companies, operating more than 1,600 restaurants in 29 countries.
As of Q2 2021, 31 hedge funds tracked by Insider Monkey have positions in Brinker International, Inc. (NYSE:EAT). The number of hedge funds that held stakes in the company remained unchanged in the first and second quarters of 2021. The hedge fund managed by Dov Gertzulin holds 258,559 shares in the company, amounting to more than $15.9 million in worth and accounting for 3.45% of the fund's portfolio.
For the fiscal first quarter of 2022, Brinker International, Inc. (NYSE:EAT) reported an EPS of $0.34, falling short of estimates by $0.37. On the other hand, the company's revenue for the quarter came in at $876.4 million, crossing market estimates by $0.18 million.
On October 22, Raymond James analyst Brian Vaccaro lowered his price target on Brinker International, Inc. (NYSE:EAT) to $60 from $67.50, and kept an Outperform rating on the shares.
9. Dine Brands Global, Inc. (NYSE:DIN)
DG Capital Management's Stake Value: $16.85 million
Percentage of DG Capital Management's 13F Portfolio: 3.63%
Number of Hedge Fund Holders: 28
Dine Brands Global, Inc. (NYSE:DIN) is an American food and dining company based in California that manages and operates the famous brands, Applebee's and IHOP.
Dine Brands Global, Inc. (NYSE: DIN) reported solid earnings in Q3 2021, with earnings per share at $1.55, crossing estimates by $0.19. The company declared revenue of $228.72 million, beating predictions by $5.25 million.
As of Q2 2021, 28 hedge funds have positions in Dine Brands Global, Inc. (NYSE:DIN), the same as the previous quarter. DG Capital Management reported owning 188,824 shares in the company, worth more than $16.85 million, representing 3.63% of the investment firm's portfolio.
On November 5, Wedbush analyst Nick Setyan raised the price target on Dine Brands Global, Inc. (NYSE:DIN) to $105 from $97, and kept an Outperform rating on the shares of the company.
Similar to United Therapeutics Corporation (NASDAQ:UTHR), Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) and Caesars Entertainment, Inc. (NASDAQ:CZR), Dine Brands Global, Inc. (NYSE:DIN) is a stock investors are paying attention to.
8. Horizon Therapeutics Public Limited Company (NASDAQ:HZNP)
DG Capital Management's Stake Value: $17.5 million
Percentage of DG Capital Management's 13F Portfolio: 3.78%
Number of Hedge Fund Holders: 56
Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) is a biopharmaceutical company engaged in the research and development of medicines for rheumatic and other rare diseases.
The company posted its quarterly earnings report for the third quarter of 2021 on November 3, reporting earnings per share of $1.75, beating estimates by $0.21. The revenue over the period was reported at around $1.04 billion, an increase of 62.94% on a year-over-year basis.
According to the Q2 13F Filings, Dov Gertzulin's DG Capital Management held over 187,314 shares of Horizon Therapeutics Public Limited Company (NASDAQ:HZNP), worth more than $17.5 million, accounting for 3.78% of the fund’s investment portfolio. At the end of the second quarter of 2021, 56 hedge funds in the database of Insider Monkey held stakes worth $4.3 billion in Horizon Therapeutics Public Limited Company (NASDAQ:HZNP). This is compared to 48 hedge funds in the previous quarter that held stakes worth roughly $4.1 billion.
On October 6, Jefferies analyst Akash Tewari assumed coverage of Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) with a Buy rating and $132 price target.
Carillon Tower Advisers, in their Q1 2021 investor letter, explains the position of Horizon Therapeutics Public Limited Company (NASDAQ:HZNP)’s Tepezza product. Here is what the fund said:
“Horizon Therapeutics is a biopharmaceutical company whose primary focus is research, development, and marketing of late-stage pharmaceutical products. After experiencing some unfortunate manufacturing hiccups in the later stages of 2020 for its key product Tepezza, which is used in the treatment of thyroid eye disease, the company recently received positive news that should relieve their supply issues going forward. With manufacturing of Tepezza back online after being forced to halt due to Operation Warp Speed’s COVID-19 vaccine production orders, Horizon expects patient treatments to resume in mid-April.”
7. Caesars Entertainment, Inc. (NASDAQ:CZR)
DG Capital Management's Stake Value: $18.18 million
Percentage of DG Capital Management's 13F Portfolio: 3.92%
Number of Hedge Fund Holders: 73
Formerly known as Eldorado Resorts, Inc., Caesars Entertainment, Inc. (NASDAQ:CZR) is among the world’s largest diversified hotel and casino entertainment companies.
Dov Gertzulin of DG Capital Management is one of the leading stakeholders of Caesars Entertainment, Inc. (NASDAQ:CZR), with 175,250 shares worth over $18.18 million as of the end of the second quarter, according to the data tracked by Insider Monkey.
At the end of the second quarter of 2021, 73 hedge funds in the database of Insider Monkey held stakes worth $1.83 billion in Caesars Entertainment, Inc. (NASDAQ:CZR) down from 76 in the preceding quarter worth $1.52 billion.
On October 20, Morgan Stanley analyst Thomas Allen raised his price target on Caesars Entertainment, Inc. (NASDAQ:CZR) to $138 from $127, and kept an Overweight rating on the shares of the company.
6. Bloomin' Brands, Inc. (NASDAQ:BLMN)
DG Capital Management's Stake Value: $18.87 million
Percentage of DG Capital Management's 13F Portfolio: 4.07%
Number of Hedge Fund Holders: 36
Bloomin’ Brands, Inc. (NASDAQ:BLMN) is a Florida-based restaurant holding company that owns and operates over 1,450 restaurants in 47 states. The company manages several American casual dining restaurant chains such as Outback Steakhouse and Bonefish Grill.
On November 3, Raymond James analyst Brian Vaccaro kept a Strong Buy rating on Bloomin' Brands, Inc. (NASADQ:BLMN), alongside a $30 price target on its shares.
DG Capital Management currently holds 695,367 shares in the company, worth $18.87 million, accounting for 4.07% of the investment firms' portfolio value.
In addition to, United Therapeutics Corporation (NASDAQ:UTHR), Horizon Therapeutics Public Limited Company (NASDAQ:HZNP) and Caesars Entertainment, Inc. (NASDAQ:CZR), Bloomin' Brands, Inc. (NASDAQ:BLMN) is a notable stock to invest in.

x̄ - > Top Secrets For Using Fintech To Manage Small Business Cash Flow Challenges

Top Secrets For Using Fintech To Manage Small Business Cash Flow Challenges

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

It is no secret that cash flow management is at the core of every business, particularly so when we talk about SMEs, wherein it can result in business failure. A variety of reasons can contribute to cash flow challenges, ranging from mismanagement of expenses to encouraging growth without the appropriate funding. The obvious solution to the problem, of course, is proper finance management. Having said that, the creation of a complex network of business activities with multiple payment channels, poor time management, and the magnitude of payments to be collected and matched to funding mechanisms as necessitated, throw most businesses into the conundrum, in the first place.

As a solution to this quagmire, fintech has developed digital tools and technologies that can offer assistance for the diagnosis, management as well as prediction of cash flow, which can help in overcoming the aforementioned challenges.

In order to understand the solutions that fintech provides, let us first assess, the need for them in the first place.

Why Do You Need Fintech For Cash Flow Management?

To manage receivables: Inefficient receivables can end up in the breakdown of communication between a business and its customers, which leads to significant delays in payment and eventually turn into liquidity issues. With fintech solutions, offering electronic invoicing and automation of the process, efficiency and scalability can be achieved for better cash flow management.

To manage payments: For any business to survive the market and thrive, it needs to have an efficient money management system. The system should be capable of collecting payments on its invoices; failure to do so would end up accumulating bad debt, and eventually, make the firms' operations unsustainable. Fintech has now enabled online and mobile-compatible payment systems that can help businesses in collecting payments for services rendered, as well as services, received, irrespective of the currency or location.

To manage employees: Payroll management is a significant upgrade that is provided by fintech to help companies eliminate any manual errors while ensuring proper distribution of paycheques. Such services also help save up on resources that would’ve been otherwise allocated to the task. Helping your company save two of the most important resources, namely time and money, fintech innovations for payroll management can help in better cash flow management as well.

To gain capital: Proper utilization of short-term business loans can help in better cash flow management. A common way to access adequate financing is via alternate lenders that provide various kinds of working capital loans for short-term needs. Alternative financial institutions are now leading the race for working capital loans that can cater to the needs of SMEs in a shorter amount of time compared with traditional financing institutions.

Secrets To Use Fintech To Manage Cash Flows

Electronic invoicing systems: It is no secret that getting paid by customers is crucial for any business and to make this easier, fintech can grant you the ability to automate these payments, which further helps in the reduction of cash flow challenges. With global payment systems, irrespective of where the money is coming from, getting paid has become simple and instant. The intervention of technology reduces the need for human interaction, which means that the lesser the number of people required to get the job done, the lesser cash to be paid, which means better cash flow.

Lending platforms: Fintech has made it possible for businesses to get access to the funding required by them. Earlier, small businesses had no option but to work with small local banks, but with the advent of fintech, online lending has become simpler and faster. The option of alternate lending has become extremely popular for SMEs, which grants them the working capital needed, speedily.

Privacy and cyber security: Data leaks form a very imminent threat, and unfortunately they are not completely avoidable. Irrespective of the size of your business or the type of business, data needs to be secured, be it personal or of customers and vendors. Fintech has made cyber security an accessible option that can help businesses in improving their security measures. The best thing about this is that you do not need to be technologically savvy to make sure that your privacy and cyber security requirements are being met well, with accessibility and timely assistance being the hallmarks of fintech services.

Discounted instant payments: Gone are the days when 90 days for the payment clearance was the standard time. We all know that small businesses and startups generally do not have that luxury, and the lack of cash ends up causing businesses to miss opportunities. There now exist a lot of resources that can offer a range of options and permit businesses to have access to money much sooner than they would in the past.

Automated payment systems: While the facility of direct debit is not something new, fintech now has enhanced the ability to leverage it considerably. By automating the process of receiving variable payments, one-off payments, subscriptions, and membership payments, there is less scope for human errors, which are used to delay payments earlier.

Rental management: The fintech revolution is now being leveraged by almost every industry, and everyone wants to be on board, including property managers and landlords. Fintech tools now make it possible for them to manage their tenants as well as their properties remotely. From sending rent notices to accepting payment digitally, fintech solutions boost productivity and ease of conducting transactions.

Granting businesses the ability to serve customers in real-time irrespective of the location, fintech has now become intertwined with business operations. Providing innovative solutions that can help SMEs in managing and controlling their payments and other transactions, fintech is changing the way the world does business, and granting small businesses the opportunity to thrive, by being able to manage their cash flow efficiently.

x̄ - > How small businesses can boost their cash flow heading into the holidays

 In every business, there’s a lag between money going out of a business and money coming in, between expenses and income. The holidays intensify that problem since you may have to order holiday merchandise in August and September and might not get paid ‘til December.

If “location, location, location” are the first three rules of real estate, the first three rules of small business money management are “cash, cash, cash.”

And if managing cash flow is important any time of year, it’s even more challenging during the critical holiday season.

In every business, there’s a lag between money going out of a business and money coming in, between expenses and income. The holidays intensify that problem since you may have to order holiday merchandise in August and September and might not get paid until December. This year, with supply chain problems, it’s harder to figure out when customers will be shopping and what they’ll be buying.

► Holiday shopping: Why small businesses need to start getting ready now

► Supply chain issues: What are they and how will shortages impact the holiday shopping season?

Even those in professional service industries may see a cash flow problem at the end of the year. Business often picks up in the last quarter – meaning more costs in staffing and expenses – but you might not get paid until January.

How can you improve your end-of-year cash flow? With two important steps: increasing the amount of money coming in and reducing the amount of cash going out. If you’ve got more money in your bank – longer – you’ll have more flexibility to respond to this year’s unpredictable holiday conditions.

► The Daily Money: Get our latest business and personal finance stories in your inbox

Get more money coming in

By offering gift cards or certificates, you get the money in your account long before a customer purchases the actual product or service.

Encourage and make “pre-sales.” Wouldn’t you like to have your hotel fully paid for the holidays well in advance? Your salon’s staff time paid by early November for services in late December? Well, find ways to encourage customers to buy, book, and pay early. Offer discounts for prepaid services or products when purchased early in the season – such as $100 worth of goods or services for $80 when paid before Nov. 15. You may have lower profit margins, but you’ll have cash sooner.

Story continues

Offer early-season deals. Why wait to offer deals ‘til Black Friday or Small Business Saturday? Offer special deals and hold special events before the height of the holiday rush. If you can get customers to buy from you early, you’ll turn over merchandise faster, reduce stress during your busiest periods, and improve cash flow.

Push gift cards and gift certificates. If you’re not offering gift cards or gift certificates, start now. After all, gift cards are, in essence, pre-sales. You get the money in your account long before a customer purchases the actual product or service. Gift certificates aren’t limited to merchandise or personal services, such as salons or spas. Even a business service could offer a gift certificate. While it may seem like a strange gift, your law firm could offer a gift certificate for drawing up a will.

Reduce or eliminate billing. If you typically bill your clients for goods or services, you’re not going to see that money for 30 or 60 days or more. Billing is fairly typical in business services and in construction, but you tie up your funds like that. Instead, request prepayment or require payment on delivery. You’ll have your money faster and less paperwork too.

Accept credit cards. When you accept credit cards, you enable more customers to pay you immediately, and you get the money in your bank fast – often the day after processing. Yes, you pay a small transaction fee for this benefit, but you don’t have to worry about checks bouncing or invoices not getting paid. If you don’t already accept credit cards, you can easily sign up as a merchant with a service like Square or Quickbooks GoPayment.

Reduce money going out

Managing cash flow is important any time of year but it’s even more challenging during the critical holiday season.

Purchase carefully. What do you really need this season: products for your retail or e-commerce store, supplies and staff for your service business, vehicles for your catering company? Examine past sales records, do your research and forecast sales. Be conservative.

Negotiate payment terms. Ask your vendor to extend the amount of time you have to pay your bills, ideally to Net 60 or Net 90. Or for large bills, ask for installment payments. This may not be typical, but it doesn’t hurt to ask, especially if you’re a good customer.

Pay by credit card. This automatically provides you with longer payment terms, keeping more money in your bank account during the holidays. If you’re deciding between vendors, look for ones that accept credit card payments or ask if they’ll take a credit card.

Get a line of credit. A line of credit from your bank acts like a credit card, but typically with much lower interest rates. If you have good credit and a good relationship with your bank, ask now for a credit line.

Arrange for a vendor to directly fulfill your customer orders. Why buy and hold inventory, especially if yours is an e-commerce business? Instead, see if you can find vendors who ship products once the order has been placed. You hold little or no inventory, and receive cash before you make the expenditure. You’ll likely have a smaller profit margin – vendors may charge more for the product as well as the fulfillment service – but you tie up far less money and reduce risk.

x̄ - > Python for Finance, Investing and Trading

 

Python for Finance, Investing, and Trading

Python for Finance, Investing, and Trading is introductory quantitative finance, an intensive practical two-day optional module.

Python is an essential, fast-growing, and highly in-demand programming language in the financial industry for financial analysis, systematic algorithmic trading, backtesting strategies, portfolio construction, optimization, and portfolio management because Python is free, has excellent libraries and documentation, and can integrate seamlessly into trading environments.

Day one introduces you to the basics of the Python programming language, statistical analysis, how to run OLS regressions, and how to obtain free financial data from a wide variety of sources.

Day two focuses on specific quantitative finance applications, trading, and backtesting strategies, and how to send your first algorithmic trades in Interactive Brokers Trading Platform (TWS and Gateway).

This is a hands-on practical programming course with step-by-step source code, in-class exercises, and full solutions provided. The course is catered for students with no previous knowledge of programming required and will start from the absolute basics. However, it is recommended to at least have some previous knowledge/contact with the language.

If you are interested in automated trading, computer science, and computational quantitative finance this course would be well suited for you and can only enhance your personal career objectives and quantitative skillsets for future job applications.

You will learn:

Basic Python Programming Introduction

Spyder and Anaconda IDE Programs

How to import/export Financial Data from a wide variety of sources

Main Financial Data Analysis Python Libraries

How to graph customized charts

Statistical analysis and regressions

Introduction to SQL Databases

Back-testing trading strategies

Analyzing strategy portfolio statistics

Interactive Broker's systematic trading

Python for Finance, Investing, and Trading is one of several optional modules offered to postgraduate students by the School of Economics and Finance at Queen Mary University of London.

x̄ - > Applications of Python in fintech companies to enhance the financial ecosystem

 

Applications of Python in fintech companies to enhance the financial ecosystem

Python is one of the top programming languages in different industries across the world in the last few years. It is well-known as a versatile, open-source, and multi-paradigm programming language besides Java, R, and so on. Developers have started using Python in fintech companies as it provides reliable solutions to different fields efficiently without any potential error. The financial ecosystem has started harnessing this programming language for running code without mistakes in fintech services. Thus, let us explore some of the applications of Python in the finance sector across the world.

Applications of Python in the Finance Sector

According to developers, Python is a very easy programming language to write and deploy for fintech companies to offer a seamless financial ecosystem to the target audience. Python in the finance sector helps to reduce critical errors to avoid serious consequences in financial transactions of valuable assets. The simple syntax accelerates the speed and productivity of developers to integrate new products and services in the world's financial ecosystem.

Creating a strong MVP is one of the top applications of Python in the financial ecosystem. Developers can harness the combination of Python with multiple frameworks to allow fintech companies to find any product or market fit as soon as possible. Thus, these fintech companies can seamlessly edit, add, or delete any part of code to create a customer-centric financial product to meet customer satisfaction and yield higher revenue in the world financial ecosystem efficiently.

Providing a wide variety of libraries and tools in the financial ecosystem is one of the top applications of Python in fintech companies. There are aspiring developers or economists who lack a strong knowledge of coding and other programming languages. Python in the finance sector helps them build multiple tools without the use of code from the scratch. It is a cost-efficient and time-saving programming language for several projects in fintech companies. It helps to bridge the gap between economics and data science through its practicality with multiple libraries and tools.

Cryptocurrency is thriving in the financial ecosystem despite being highly volatile in nature. Fintech companies have started using cryptocurrency to provide a seamless and faster transaction process through blockchain technology. Developers and Python engineers are required to retrieve the current cryptocurrency prices for the best pricing scheme through effective data visualization. Python in the finance sector helps fintech companies to build projects with live cryptocurrency data from the web.

Developers in fintech companies have started using applications of Python for its benefit in quantitative finance. Python libraries offer solutions that can process as well as analyze enormous sets of real-time data in the financial ecosystem to retrieve crucial information. Developers can utilize multiple Python solutions that are equipped with strong machine learning algorithms for providing predictive analytics for all fintech companies.

One of the top applications of Python is the ability to build different financial platforms and solutions for the world's financial ecosystem. Python in the finance sector helps to build ATM software, mobile banking platforms, digital wallets, and many more to boost and improve payment processing efficiently and effectively. This programming language is well-known for offering secure APIs, payment gateway integration, interconnection transaction management, as well as high scalability.

x̄ - > Thanksgiving Survey: Majority of Poultry Purchasers Find Turkey Factory Farming Practices Unacceptable

Washington, DC—As families start shopping for their Thanksgiving menus, a new survey commissioned by the Animal Welfare Institute (AWI) finds that a majority of poultry purchasers think conventional turkey production practices are unacceptable.
According to an online survey conducted by The Harris Poll among more than 1,700 US adults who purchase poultry products at least once a month, 70 per cent said it was totally or somewhat unacceptable for conventional turkey producers to deny these animals access to fresh air and sunlight. More than 3 in 5 of these poultry purchasers found it totally or somewhat unacceptable that producers confine turkeys indoors for their entire lives (64 percent), expose the animals to continuous, artificial light for 20 hours a day (61 per cent), subject them to beak trimming and other physical alterations without pain relief (63 per cent), and use growth promoters or non-therapeutic antibiotics to raise them (61 percent).
“Families are increasingly demanding more compassionate food options when gathering for the holidays, yet the vast majority of birds found on supermarket shelves continue to suffer in overcrowded, disease-ridden factory farms,” said Dena Jones, farm animal program director for AWI. “Fortunately, there are higher-welfare poultry alternatives and plant-based options that can easily be incorporated into your favorite recipes without subjecting farm animals to a grim existence.”
Each Thanksgiving, 85 to 90 per cent of people nationwide collectively consume an estimated 46 million turkeys, according to the National Turkey Federation. It takes an informed consumer, however, to sift through the number of misleading turkey labels sanctioned by the US Department of Agriculture.
In many cases, turkeys in industrial systems breathe in dangerous levels of ammonia and suffer from health and welfare problems resulting from selective breeding for rapid growth and high meat yield. Despite mounting public opposition to such practices, turkeys are often forced to endure painful mutilations to prevent feather pecking, cannibalism, and other aggressive behaviors due to crowding and stress.
The inhumane treatment of turkeys continues upon leaving the farm. During transport and before reaching the slaughter line, thousands of birds experience heat or cold stress, starvation, dehydration, suffocation, or death from blunt force trauma, according to USDA inspection records. AWI and Farm Sanctuary sued the USDA last year for failing to require humane handling of poultry at slaughter, which causes birds to suffer excruciating deaths and can compromise food safety and meat quality. Last month, a federal judge ruled that the lawsuit may proceed after the USDA moved to dismiss it.
To help consumers better evaluate their food choices, AWI provides a comprehensive guide to animal-raising claims commonly found in meat, egg, and dairy products. The guide divides claims about how farm animals are raised into “best choices,” (such as Certified Animal Welfare Approved by AGW and Global Animal Partnership, Steps 4, 5, and 5+), along with “next best choices,” “fair choices,” and “beware of these labels” (including “cage-free” and “no added hormones” for turkeys and chickens raised for meat, and “natural” for all animal food products). And, of course, one can simply leave turkey off the plate. A growing number of Americans are celebrating the season with cruelty-free, plant-based protein options.
The Animal Welfare Institute (awionline.org) is a nonprofit charitable organization founded in 1951 and dedicated to reducing animal suffering caused by people. AWI engages policymakers, scientists, industry, and the public to achieve better treatment of animals everywhere—in the laboratory, on the farm, in commerce, at home, and in the wild. Follow us on Facebook, Twitter, and Instagram for updates and other important animal protection news.
Survey MethodThis survey was conducted online within the United States by The Harris Poll on behalf of the Animal Welfare Institute from October 12-14, 2021 among 2,019 US adults ages 18 and older, among whom 1,733 purchase fresh, frozen, or processed poultry products at least once a month. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact Dena Jones.

This work is licensed under a Creative Commons Attribution 4.0 International License.

x̄ - > Trading With Gaussian Statistical Models

 

Trading With Gaussian Statistical Models

Carl Friedrich Gauss was a child prodigy and a brilliant mathematician who lived from the late 18th to the mid-19th century. Gauss' contributions included quadratic equations, least-squares analysis, and the normal distribution. Although the normal distribution was known from the writings of Abraham de Moivre as early as the mid-1700s, Gauss is often given credit for the discovery, and the normal distribution is often referred to as the Gaussian distribution.

Much of the study of statistics originated from Gauss, and his models are applied to financial markets, prices, and probabilities. Modern-day terminology defines the normal distribution as the bell curve, with mean and variance parameters. This article explains the bell curve and applies the concept to trading.

Measuring Center: Mean, Median, and Mode

Measures of the center of distribution include the mean, median, and mode. The mean, which is simply an average, is obtained by adding all scores and dividing by the number of scores. The median is obtained by adding the two middle numbers of an ordered sample and dividing by two (in case of an even number of data values) or simply just taking the middle value (in case of an odd number of data values). The mode is the most frequent of the numbers in a distribution of values.

Key Takeaways

Gaussian distribution is a statistical concept that is also known as the normal distribution.

For a given set of data, the normal distribution puts the mean (or average) at the center and standard deviations measure dispersion around the mean.

In a normal distribution, 68% of all data fall between -1 and +1 standard deviations of the mean, 95% fall within two standard deviations, and 99.7% fall within three standard deviations.

Investments with high standard deviations are considered higher risk compared to those with low standard deviations.

Theoretically, the median, mode, and mean are identical for a normal distribution. However, when using data, the mean is the preferred measurement of the center among these three. If the values follow a normal (Gaussian) distribution, 68% of all scores fall within -1 and +1 standard deviations (of the mean), 95% fall within two standard deviations, and 99.7% fall within three standard deviations. Standard deviation is the square root of the variance, which measures the spread of a distribution.

Gaussian Model to Trading

Standard deviation measures volatility and determines what performance of returns can be expected. Smaller standard deviations imply less risk for investment while higher standard deviations imply higher risk. Traders can measure closing prices as the difference from the mean; a larger difference between the actual value and the mean suggests a higher standard deviation and, therefore, more volatility.

Prices that deviate far away from the mean might revert back to the mean so that traders can take advantage of these situations, and prices that trade in a small range might be ready for a breakout. The often-used technical indicator for standard deviation trades is the Bollinger Band® because it is a measure of volatility set at two standard deviations for upper and lower bands with a 21-day moving average.

Skew and Kurtosis

Data do not usually follow the precise bell curve pattern of the normal distribution. Skewness and kurtosis are measures of how data deviate from this ideal pattern. Skewness measures the asymmetry of the tails of the distribution: A positive skew has data that deviate farther on the high side of the mean than on the low side; the opposite is true for negative skew.

While skewness relates to the imbalance of the tails, kurtosis is concerned with the extremity of the tails regardless of whether they are above or below the mean. A leptokurtic distribution has positive excess kurtosis and has data values that are more extreme (in either tail) than predicted by the normal distribution (e.g., five or more standard deviations from the mean). A negative excess kurtosis, referred to as platykurtosis, is characterized by a distribution with extreme value character that is less extreme than that of the normal distribution.

As an application of skewness and kurtosis, the analysis of fixed-income securities, for example, requires careful statistical analysis to determine the volatility of a portfolio when interest rates vary. Models that predict the direction of movements must factor in skewness and kurtosis to forecast the performance of a bond portfolio. These statistical concepts can be further applied to determine price movements for many other financial instruments such as stocks, options, and currency pairs.