In 2017, Damian Gawlowski, a South Africa insurance contractor based in the City of London, uncovered the hidden impact of intermediary fees with the more risk an investor took on
DAVOS, Switzerland, January 25, 2019/ — In the Financial Times’ (www.FT.com) report on Innovation in South Africa today, Aziza Coin (www.Aziza.io) simulates how to beat high fees and shows why “excessive profits in UK fund management industry handicap growth on the African continent.”
In 2017, Damian Gawlowski, a South Africa insurance contractor based in the City of London, uncovered the hidden impact of intermediary fees with the more risk an investor took on. Up to 78% of returns from private equity are consumed by intermediary fees. Gawlowski investigated and found that while this was the case, the underlying equity and bond returns were over 4% rather than the 1% he actually received. Undisclosed fees added, he calculated, made intermediaries consume over three-quarters of the underlying returns generated by the bond portfolio that was ultimately invested in. Gawlowski considered putting his pension into higher risk investments such as private equity funds and as the mutual fund returns resulted in real depreciation of his pension by 1.3% per year after fees. He modelled a dummy private equity portfolio where he calculated that the portfolio would need to make 140% over a typical seven-year period simply to cover the fees and to keep up with inflation. This meant that an (annualised) internal rate of return of 13.3% would be required to simply retain his 2017 buying power by achieving UK inflation of 2.7%. *
The Financial Conduct Authority has expressed concern about the level of fund management profits when it was quoted as saying in a report lambasting the statutorily-protected revenues of the United Kingdom’s £6.9 trillion fund management industry’s’ profit margin of 36%. It found that “firms do not typically compete on price with their retail active funds in the UK [and that] there is some evidence of a negative relationship between net returns and charges.” **
These fees, which the FCA regards as excessive, have real societal costs. As Einstein is alleged to have said, compound interest is the most powerful force in the universe. A pension that appreciates by 13.3% per annum (ie gross returns without the 78% intermediary fees will return 140% in seven years time, whereas with the fees added, an annual return of 2.7% will only appreciate by 20%. These fees have already broken the defined benefit company pensions system and has the potential to cause real poverty in the Western world, where their effect is not well understood by the general population. The fact that the UK financial services PR industry is worth £2 billion per year does not help. Furthermore, if the fund management industry is taking three-quarters of returns, with 40% of funds disappearing upfront, it becomes distinctly more risk averse, as any loss of retail investor capital will invite scrutiny and therefore shed light on the level of their fees.
This risk aversion is manifested in the fact that 0.02% of assets under management or only 8 billion Euros were allocated to startups in 2016. This matters since start-ups create more jobs than the rest of the economy combined. Pre-ICO, Damian invested in the Aziza Project, which seeks to use distributed ledger technology to automate and disintermediate the layers of fund management costs. The Project was careful to avoid the usual pitfalls that have beset other cryptocurrencies:
- From the outset, it avoided the argument as to where it was a security or a utility, by registering under Reg D exemption in the United States as a security token.
- Every buyer and seller of coins has been vetted and subject to the level of KYC required to open a high street bank account as well as being checked as being recorded as a taxpayer.
- It became the first cryptocurrency in the world to integrate its reporting systems with a tax authority when it became a third party data provider to South African Revenue Services (SARS), ensuring that investor gains were reported and taxed as capital gains. 4. It is asset-backed by seven oil and gas concessions in Southern Africa. Aziza Coin offers something Damian could not find anywhere else – low transparent fees where investor fees are limited to 10% upfront with no further fees. Its Ethereum-based smart contract automates the annual fund management function with a mere 800 lines of code. So if the underlying exploration projects deliver the same underlying returns as Damian’s fictitious portfolio – 140% in seven years, his returns after fees will increase from 20% using traditional fund management fee structures to 126% — over six times times the returns.
Aziza Coin offers something that excites Damian more than reducing the fees. He has starting working on Acqumine, which has had discussions with the South African Revenue to internalise commodities taxation into a smart contract and eventually a pan-African commodities exchange that will enable host countries and local communities in the developing world to receive royalties due to them, while giving end customers piece of mind as to the true source of the minerals that make up consumer goods they buy.
Learn more about Aziza Coin at: www.Aziza.io
Based on IFA trail commissions of 3% upfront plus 0.5% per year, pension fund fees of 1.o% per year, fund of fund fees of 1% per annum and 10% profits and private equity fees of 2% per annum and 20% of profits on exit. Based on a dummy portfolio of five investments delivering an average of 140% over a seven year period.
Asset Management Market Study – Final Report Market Study – MS15/2.3-June 2017 recommendations 1.9 1.10 and 1.11 page 4 https://bit.ly/2tnjKVw
Note: Aziza Coin is not available for sale.
Distributed by APO Group on behalf of Financial Times Africa Representative.
How to Invest Safely in Digital Assets
Over the past few years, digital assets such as Bitcoin have seen an astonishing increase in popularity. Much of this can be attributed to the growing list of innovative use cases and benefits offered by these virtual currencies and their underlying blockchain technology.
Some of the widespread use cases of popular cryptocurrencies include:
- Bitcoin — Access to fast and secure financial services to all users worldwide.
- Asset-backed tokens — Grant ownership to a real-world physical assets such as gold and real estate.
- Ethereum — Facilitates building and deployment of decentralized applications (DApps).
- Stablecoins — Provide stability in a highly volatile crypto asset markets.
- IOTA — Powering the future of the Internet of Things (IoT).
Despite some digital currencies offering wide ranging use cases, the majority of people still generally view crypto assets as investment vehicles and stores of value. If simply looking at the statistics, cryptocurrencies have appreciated significantly in price over the last few years and investment in them is very attractive to not only retail investors but even large investment managers like Ark Invest are proponents and publicly traded corporations such as MicroStrategy, Tesla and SpaceX now hold Bitcoin on their balance sheets
Bitcoin, the leading cryptocurrency, has maintained an average growth rate of 87% year-on-year since 2015 — over 100% growth in value was recorded between 2020 – 2021. Thus, it is not uncommon to see people buy bitcoin and wait for it to increase in value to make profits.
As the popularity of digital assets increases and they continue to receive significant attention, more people are increasingly getting exposure into the space. New investors are taking the leap by investing in crypto assets, with a lot of people choosing to buy bitcoin and other crypto assets.
However, just like any other investment, crypto investment poses its own set of risks and challenges — and if not careful, investors can lose their money. Many people are investing in crypto without being knowledgeable on how to keep their investments safe.
Before investing in crypto, all investors must have sufficient knowledge on how to keep their investments safe. Take the time to learn the common safety pitfalls and how best to avoid them.
Below are the top must-know tips to start investing safely.
Cryptocurrency exchanges are platforms that facilitate crypto trades. They allow customers to trade cryptocurrencies for fiat currencies or other crypto assets. Exchanges are the entry point for crypto investment and it is extremely important to choose the right one when entering the market. Currently, there are over 200 listed crypto exchanges available in today’s market.
When choosing the right crypto exchange, some fundamental features to watch out for include the location of the exchange and the country’s crypto restrictions, ease of use, the exchange services and support, security features, transaction fees, volume, and liquidity, etc.
Make sure you make properly research before choosing an exchange to use. Look into the exchange’s history, check whether it has any history of security and financial breaches. Get reviews on the exchange from the community and seek the advice of experienced investors.
Beware of fake crypto exchange platforms. It is recommended to stick to reputable and recognized exchanges. For fast and secure crypto transactions, check out reputable global crypto exchange platforms such as Remitano.
The platform features a host of interesting options that enables smooth crypto transactions. Users can buy bitcoin in South Africa through the peer-to-peer channel, swap with other cryptos, make extra income by investing using the Remitano invest option, and much more.
Remitano – the global peer-to-peer marketplace is also currently developing its native token, RENEC, to improve the quality of services delivered to customers, reduce transaction fees and ensure secure and swift transactions. While RENEC is still in the development phase, Remitano has provided an amazing opportunity for old and new Remitano users to earn FREE RENEC.
Understand the Project
Before diving into a crypto investment, it is highly advisable to take time to understand the crypto asset you are planning to invest your money in. Cryptocurrency projects, just like any other business project aim to solve relevant problems. Crypto projects with sound fundamentals, clear use cases, and realistic goals are likely to thrive in the future. Those types of project are good prospects and have potential to provide a good return on investment.
Carry out detailed and in-depth research on any crypto project before investing in it. Read the project whitepaper, understand its use cases, check what the community is saying about the project — this will give you an idea of the issues or highlight strengths and weaknesses. Check the project’s development activity, the exchanges that the crypto token is listed on to ensure its market is liquid, check the total coin supply, circulating supply, and market capitalization, etc.
Avoid investing based on hype and never invest based on FOMO (fear of missing out). This is no substitute for proper research and sensible assessment of risk potential and an understanding of what you are investing in.
Choose the Right Wallet
So, you have decided on the crypto asset you wish to invest in and you have chosen the right exchange to make the purchase. The next thing is to transfer your holding to a secure wallet for safe storage. Knowing the right crypto wallet is one of the most important steps to guarantee safety on one crypto investment. After you learn how to buy bitcoin, you have to store it in a secure wallet, otherwise, you risk losing your investment to digital theft.
Choosing the right crypto wallet can be a daunting task. There are hundreds of crypto wallets in the market — each with its security features and unique level of safety. The category of wallets available includes hot wallets, cold wallets, software wallets, and hardware wallets.
Choosing a safe and secure wallet is very important and should not be overlooked. Make sure you properly research when deciding on the type of wallet to store your crypto coins. Make sure you know the difference between each category of wallets available, understand their strengths and weaknesses before choosing the most appropriate one for you.
Consider such things as – Is the wallet easy to use? Does it have a backup feature? What are the security features? Is the wallet provider transparent on how they operate? And lastly, is the wallet or provider reputable? All these are fundamental questions to seek answers to before choosing a wallet.
Also, ensure you are protecting yourself from online theft by safeguarding your wallet key and password. Safeguard your wallet by incorporating a two-factor authentication system. Beware of scam mining platforms, fake giveaways, shady ICOs and many other scams. All these make you vulnerable and put you at risk of losing your investment.
Diversify Your Investment
Investment 101 — diversify your investment portfolio. This does not only hold true when it comes to crypto investments but all other asset types.
Cryptocurrencies are inherently volatile, and there is always a potential for a market downtrend. This makes diversification a good investment strategy in crypto. By spreading your investment, you are not only allowing yourself to profit on multiple fronts but also reducing the risk of losing all your money if a particular asset becomes unfavourable.
There are over 1000 crypto projects available in the market – each offering their own unique crypto token. You don’t necessarily need to only buy Bitcoin but can also purchase other assets such as Ethereum. Do not put all your eggs in one basket! Instead, hedge your bets through diversification. This will help mitigate the risk of digital currency investing.
Do ensure you do in-depth and detailed research on the assets you wish to invest in. With proper fundamental and technical analysis, you can find some good crypto projects with great prospects.
Understand Your Risk Tolerance
While there is no definite rule on the amount to invest in cryptocurrency, it is recommended that you always invest what you can afford to lose. In crypto investment, you win some and lose some. With this in mind, always invest within your limits. Understand your risk tolerance and invest accordingly.
By allocating investments in alignment with your risk tolerance, you are potentially mitigating losses.
What is the future of crypto trading in South Africa? Find out if crypto will gain more popularity or be subjected to stricter regulations by the South African government.
Article by: Heath Muchena
Cloud Storage vs. Cloud Computing: What’s the Difference?
Cloud storage (Image Credit: DepositPhotos)
Cloud storage and cloud computing have become fairly ubiquitous terms. The chances are that if you’ve done any sort of remote correspondence over the last few years, you have probably come across these terms countless times.
Even if you don’t fully understand the concept, you are probably engaging in some sort of cloud storage, file sharing, or computing. Cloud technology has become such an important part of modern computing, to have no experience with it is incredibly doubtful.
What is “The Cloud?”
Before delving deeper into the differences between cloud storage and cloud computing, let’s make sure we know exactly what we mean when referring to “the cloud.”
The cloud, ominous and mysterious as it may sound, refers to a remote server system where a user’s or business’ data is stored. If you own an Apple product, you have probably been prompted endlessly to set up your iCloud account. This service allows you to back up files, such as photos, music, and documents, on Apple’s proprietary server. This takes a lot of the heavy lifting off of your personal computer, creates backups of your files if any system failure occurs, and makes your files available through any computer with an internet connection.
The Difference Between Cloud Storage and Cloud Computing
Now that we have a better idea of what the cloud is, we can look at what cloud storage and cloud computing are and how they are different.
What is Cloud Storage?
Cloud storage is the computing process in which files are stored remotely on a network of external servers. By doing this, cloud storage allows users to accomplish various things that would otherwise be impossible, one of which is cloud file sharing.
If you run a business where the bulk of your employees are working remotely or even just involved in some manner of correspondence that necessitates the swift transfer of files, being able to store and access important documents from wherever you are is a huge convenience. Essentially, your office becomes anywhere you can access the internet.
Another reason you might consider cloud storage is if you are dealing with high traffic and large file sizes. Your resident computing infrastructure may be unable to cope with such demand. And the cost and upkeep of additional on-premise equipment, not to mention the toll of an expanded IT team on your payroll, may prompt you to look for the best cloud storage providers to implement a hybrid cloud solution.
By outsourcing some of your storage to a cloud provider, you can rest assured (in most cases) that your data is in good hands. These providers, be they Apple, Google, Carbonite, Bitcasa, etc., devote vast amounts of resources to making sure your data is safe from system failures as well as hacking.
What is Cloud Computing?
Cloud computing comes in several different forms, ranging from the everyday to the very complex. In its simplest terms, cloud computing allows users to access and use a cloud hosting provider’s software services. It takes data that is already stored in the cloud and enables certified users to access and manipulate that data from wherever they are.
Think, for example, a shared document on Google Docs. The software used as the medium for the data is hosted by Google, as it is not stored in the users’ computers, and data can be added, removed, changed, and tracked in real-time. This allows for greater collaboration and transparency between users. This form of cloud computing is called software as a Service (SaaS).
Cloud computing also comes in the form of workflow management apps like AirSend. AirSend, and its competitors, provide an interface for real-time communication between individuals in a company. It allows file sharing, cloud storage, general and private chat, video and audio calls, and software integration.
In COVID, where users are predominately operating remotely, cloud computing has experienced a considerable increase in popularity. Using standard software that interconnects everyone involved in a project, individual users can collaborate and communicate in real-time. It has drastically reduced the need for people to be in the same room as one another.
Another form of cloud computing is concerned with harnessing a remote computing system’s processing power or specialized applications. For example, a company that is inundated with a vast amount of data may purchase the services of a cloud computing provider to process the raw data into whatever form they need. This takes the load off their local computing infrastructure, which may not handle such a massive influx of information.
The Difference in Cost Between Cloud Storage and Cloud Computing
Comparing the cost of cloud storage to the cost of cloud computing is tricky because there are so many different services provided through cloud technology, and the degree to which they are offered varies based on each client’s needs.
Cloud storage allows you to only pay for what you need, whether five terabytes or 5 petabytes. The critical thing to remember about cloud storage costs is that it is a passive service. One does not have to actively engage with cloud storage for it to provide any benefit. By simply storing your data safely and making it retrievable when needed, cloud storage fulfills its duties.
The same does not go for cloud computing. Cloud computing is only worth the money put into it if its services are being used. In cases where you are utilizing another system’s processing speed for raw data rendering, you often pay for a small time frame of maybe a few hours. This situation should be pretty self-explanatory. However, for services with monthly subscription fees, if cloud computing applications go overlooked, you will be hemorrhaging money for no reason.
For cloud storage and cloud computing, one must also look at the costs they are offsetting. By employing a cloud server to store data, you are reducing the costs of keeping and maintaining local servers. As with cloud computing, you may occasionally need the processing power of a highly sophisticated computer system but not on a regular basis. In this sense, while still costing a fair bit, cloud storage and computing are far less expensive than housing and expanding local systems.
The Future is Cloud
Cloud storage and cloud computing are ubiquitous in today’s business world, but the degree to which they are used is another question. At their most rudimentary levels, their cost is either free or negligible, and they offer great convenience to both the personal user and small businesses. However, as needs increase, cloud services such as cloud storage, cloud computing, and cloud file sharing become more costly and serve a greater purpose in the makeup of a well-functioning company.
Author: Abhishek Bakshi
Caching and Why it is so important
Have you ever noticed that when you frequently visit a website it loads a lot faster than the first time? That is due to a little something called caching. This is the process of storing copies of website files into a temporary storage location (called a cache), so that future requests for that data can be loaded faster. Web browsers such as Google Chrome or Firefox and the webserver make a cache to ensure the website performs faster.
If you’re implementing caching properly your website visitors will not only love the faster experience but this improved performance comes with improved conversions. A conversion for example is an online sale, a booking confirmation, a lead generation request or a general enquiry, depending on the website and what they’re selling.
Let us dive into the two types of Web Caching:
- Browser Caching
- Server Caching
Websites and web applications are hosted on servers. On these servers, we can also take advantage of technologies and settings to set up server caching. Server caching is another technique to make your website or web application faster. In a nutshell, this is how it works: when website visitors request to view a specific page on a website, the webserver then processes this request. After the first request is completed by any user, the server will then remember this request so that next time it gets the same request it can deliver the same result or data to the website and much faster.
Benefits of caching
The clear benefit of caching is that we’re able to provide users with a faster loading website and provide the user with a great user experience (quick loading time) This applies to websites that are loaded both on desktop devices and mobile devices. Another big benefit that many people overlook or aren’t aware of is that search engines such as Google and Bing also give preference to websites that load really quickly when it comes to ranking higher Search Engine Results Pages. The improved speed contributes to the improved SEO score of your website. This can be crucial to obtaining higher traffic to your website and ultimately better conversions and more money to your bottom line.
Is caching effective?
People often question the effectiveness of caching and if it should be implemented on their website. Its aim is to speed up your website and reduce load speeds, for both your website visitors and search engines. This is a clear advantage and therefore definitely effective. The shaved offloading time can have a direct impact on your website’s performance, especially with heavy traffic loads and improve your SEO rankings. It’s important to remember, caching needs to be implemented correctly and properly for it to be effective. Applying caching rules on the web browser or implementing the technology on the server in the wrong way can also be counterproductive and detrimental to your website and business. Only experienced web developers should be trusted with the implementation of caching solutions on websites and web applications.
Is there a downside to caching?
Anything after the question mark is the query string. Putting any random text after it would work as long as the end URL looks different: So “/css/style.css” is not the same as “/css/style.css?v=2” and the browser will load the updated style.css file. Alternatively, the user will have to do a cache refresh (ctrl+f5 on windows) or wait for the cache to eventually expire. Server-side caching all depends on how it’s implemented and where it’s stored. It might take a script to clear the cache, deleting a folder on the file server or clearing a database table. If the website is on a CDN then you have to use that service’s control panel to force each endpoint to update with the latest files and clear the cache.
When should caching NOT be used?
There’s no reason not to use client-side caching because why redownload the assets if it’s going to remain the same? Server-side validation on the other hand means you have dynamic content and you want to be careful what exactly you cache. You could be caching complex statistics and graph data that only change once a month. This could take several minutes to generate, which you don’t want your user to wait for, caching this makes sense. But what if that data is updated frequently then caching the end result is not an option because some users will see the outdated results. In this scenario, caching isn’t the solution and you’ll have to find a different way to present this to the user. We’ve seen in different projects that we’ve taken over that many inexperienced developers rely on server-side caching far too much. This is because they can’t efficiently write queries and source code to solve the problems, but turn to caching the data on the server to make it load faster (but not correctly).
But what if my content changes?
We know what you may be thinking: caching has many benefits to make my website load in a super-fast response time, but what if I have caching enabled and I publish new items or my content changes, then what? Will these new changes not be cached and therefore not unseen to website visitors? Caching systems that are set up properly are able to deal with these types of scenarios. Not only does caching systems consist of ways to store data for speedy display but they are also capable of emptying the cache when certain criteria are met. The cache can then be regenerated once the cache has been emptied.
Last but not least…
Caching is a very sophisticated technology that increases the speed at which your website or web application can load, without requiring additional processing power. Implementation of caching can be tricky and needs to be done properly. Once done it will result in faster load times and reduce the strain on your server. A faster website or web app means that your users will love browsing around and Search Engines will also appreciate this loading speed, giving you a boost on your SEO score.
Article by: Angelo Zanetti
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