Nicholas Fainlight is an aspiring finance professional.

Tag: economy

How To Balance Profit And Purpose In Business

How To Balance Profit And Purpose In Business

Entrepreneurs need to build business empires while still staying committed to their purpose. A significant number of business people struggle to commit to their purpose while still keeping their enterprises profitable. Businesses need to demonstrate their contribution to humanity while still growing their profit margins. Here are ways businesses can balance profit and purpose.
Go Green

In the past few years, many businesses have shown their commitment to adopting more sustainable production methods. No matter the size, every organization can play a role in reducing its environmental footprint. Surprisingly, the current generation prefers to buy green products. Therefore, companies that will demonstrate high sustainability credentials will gain numerous customers who want to buy green.

For instance, manufacturers can reduce carbon emissions by sourcing closer to home. When raw materials are transported for short distances, it helps cut both transport costs and carbon emissions. Besides, leaders who have a passion for conserving the environment can shift to renewable energy sources.

Find an Inspiration

Walk away from your comfort zone and start doing something new that challenges you. Learn from these things and find inspiration in them

Leverage Technology

Technology is changing every aspect of life, including how consumers interact with brands and how they buy products and services. For example, online sales have doubled in the past five years. Additionally, organizations are using machines to understand customer needs better. This means that businesses must stay on top of the latest innovations to remain competitive in their respective industries.

Share Your Success

Entrepreneurship is a murky journey characterized by ups and downs. Therefore, successive entrepreneurs should consider sharing their experiences with novice business people. When you balance profit and purpose, your impact is significant and tangible, and more consumers will want to be associated with your business.

Understand Your Purpose

Purpose goes beyond providing high-quality goods and services to consumers. It also means that your business prioritizes the common good of the community. For example, some companies such as Unilever have already developed a unique living plan to track their progress of minimizing their environmental footprint. Business leaders should devote time to learn about societal impact and how to improve it.

To change business operations to meet new expectations requires exceptional and visionary leadership. In today’s versatile business world, leaders who will adopt agility will be in a better position to achieve long-term success.

Person skydiving in a clear blue sky, image used for Nicholas Fainlight blog on risk in finance

The Importance of Risk When It Comes to Finance

Person skydiving in a clear blue sky, image used for Nicholas Fainlight blog on risk in finance

Risk is involved in every aspect of life. The risk of taking your first steps is falling; the risk of asking a person on a date is rejection; the risk of interviewing for a job is failure; the risk of parallel parking is hitting another vehicle. So, it is guaranteed that creating a business or investing in something financially, as well as physically, involves considerable risk.

What is risk? According to Google, risk is the possibility that something unpleasant or unwelcome will happen. However, according to the business dictionary, risk is a probability of damage, liability, loss, or any other negative occurrence that is caused externally.

From a finance point of view, risk is the probability that an investment’s return will be less than expected. However, risk also offers the chance of reward. For example, a reward could be an increased return compared to a lower expectation. Financial risk is comprised of multiple categories: basic risk, capital risk, delivery risk, exchange risk, interest rate risk, political risk, settlement risk, underwriting risk, and much more.

Examining financial risk includes looking at daily finance operations, such as cash flow, transactions made by the business, and the business’ financial systems set in place. You may consider things like which clients owe the company, how the company plans to retrieve the money, insurance, and its coverage, as well as whether the business can extend credit to customers and how.

When calculating financial risk, external factors like interest rates and foreign exchange rates should be considered. Those factors can affect company competitiveness with services produced abroad; changes in interest rates and exchange rates can immediately affect debt repayments.

All businesses should extensively discuss risk management within the business’ strategic management. Doing so allows the company to identify and tackle any risks before they become an issue, which will in turn aid the chances of reaching defined business goals.

Once the risks have been pinpointed, there are several ways to address them: accept it, transfer it, reduce it, and eliminate it. Acceptance of a risk might happen if the costs are too high to handle it in any other way. The risk could be dealt with by transferring, which typically takes place with the company insurance. Reducing a risk is merely introducing safety measures to keep the risks from occurring, and eliminating the risk could be something like changing the production process. Once the risks have been determined and the type of management has been decided, take steps to put the measures into place.

Risk management is not a one time kind of deal; it requires consistent monitoring and should often be reviewed to ensure the management approach is successful. Set the plan in stone by creating a risk management policy that will identify the company’s approach to risk, and it’s management. The CEO’s and the board should all be on the same page before moving to the management policy phase.

All choices in life and business involve risk to some extent. By understanding what risk is and how to manage it, business and employees are more likely to meet their financial goals.

Nicholas Fainlight- Face Recognition Technology

All About Face Recognition Technology

How We Pay

The ways that individuals have paid for items and services has changed greatly over the years. At one time, different cultures would do trade for services or items. Now the majority of countries use currency or credit cards in order to make payment. Many credit cards have evolved to include a chip that is supposed to make credit card purchases more secure. In China, they are rolling out a completely new way to make payments.

Face Recognition Technology

Face recognition technology is taking purchasing to a different level. It is a technology that promises to replace credit cards, passwords, and identification. In China, there is a new app that has rolled out, and it is being used by 120 million people. This is an app that allows individuals to transfer money using a facial recognition technology. This technology enables an individual to leave their currency and cards at home. All they have to do is use their smile, and they can make a purchase. This application is called AliBaba Auto Pay Experts. This face recognition technology is sure to become popular in the Western world as well because it is highly accurate.

How Does Face Recognition Work

Face recognition is a technology that has been around for years, but it has greatly improved. Face recognition is precise, and it uses advanced technology to identify the special features on a person’s face. This technology has been shown to be more precise than voice recognition. This is a technology that can identify faces in different lighting and at different angles. There are some financial institutions in China that have gone as far as using face recognition to give out loans.

What Companies Are Interested In Face Recognition

Companies such as Google, Amazon, Facebook, and Apple are interested in face recognition technology. These companies could use this face recognition technology to learn about their customers interest, hobbies and preferences. Also, this technology can enable social media sites to tag an individual’s face on their friend’s photos.

Face Recognition And You

Face recognition could bring huge benefits to consumers all around the world. With the huge amount of theft that occurs currently, an individual can feel secure in knowing that he or she has nothing on their person that can be taken away. Face recognition is definitely the way of the future.

Nicholas Fainlight- Do Natural Disasters Affect Stocks?

Do Natural Disasters Affect Stocks?

A natural disaster such as a hurricane or earthquake can create devastating consequences for any human or home that stands in its way. Buildings are crumpled, water damage from flooding wreaks havoc and what was once a community becomes an area requiring total repair. However, this wreckage does not always indicate that a disruption will also take place in the stock market. While there may be short-term fluctuations in the price of oil and insurance stocks, the long-term health of the stock market is dependent on other factors as well.

Looking To The Past

To understand how natural disasters affect the stock market, it’s best to look at the past and see how it fared after the occurrence of major hurricanes. One example of a major natural disaster that caused widescale destruction was when Hurricane Katrina passed through Alabama, New Orleans and other areas near the Atlantic Ocean. This 2005 event created $108 billion in damages — still the costliest on record. Yet, the stock market continued to head higher and shake off the devastation. How could this be?

What Drives Markets Higher?

While the devastation from a natural disaster does cause a considerable amount of monetary damage, the spectrum of events that occur after the damage has taken place must be examined. In the short term, there will be price fluctuations related to equipment or buildings that have been taken out. However, the United States stock market seems to shake off disasters and continue its steady price movement upwards. This could be due to other economic factors that are already in place such as low inflation, declining unemployment or policy from the Federal Reserve.

Outcome of Hurricanes Harvey and Irma

Hurricane Harvey passed through Texas in late August 2017 with wind speeds reaching 130 miles per hour. One week later, the state of Florida was hit by Hurricane Irma — a Category 4 hurricane. Both of these monsters destroyed anything that stood in their path. Yet, near the end of September, the S&P 500 was reaching new highs. One must consider the rebuilding and investment that will need to be done to create new communities. These factors may be part of the reason for the continued gains seen in the stark market as well as other economic factors that are already in place.

While one would think that major hurricanes or other natural disasters would cause the stock market to fall — that’s not the case — the stock market has continued to rise after these devastating events.

Nicholas Fainlight- How the World's Stock Markets Have Evolved Over Time

How The World’s Stock Markets Have Evolved Over Time

Stock markets are one of the most important parts of the global economy. Stock markets are an important part of economic growth. The origins of the stock market can be traced back to France, where residents used a system that managed debts while serving the best interests of the banks. In Italy, bankers started trading government securities. The actual beginning of the stock market occurred in Belgium and the Netherlands. Antwerp, Belgium is recognized as having the World’s first organized stock market system. However, during this time period, debt was being regularly traded instead of shares of a company.

East India Company

The East India Company is considered the first publicly traded company in the World. Investors realized that going all in was not a long term beneficial strategy. They started buying shares in other companies so that investments would be less risky. Over the next few years, many European countries started using the system. Investors traded ideas in coffee shops. However, due to a lack of regulation, the early days of the stock market were very unorganized.

New York Stock Exchange

The New York Stock Exchange was considered a breakthrough. Soon the NYSE established itself as the center of US trade. Thanks to a void of any real competition, the NYSE thrived.

Today’s Climate

Almost every country in the World has their own stock market. Over a trillion dollars are traded on stock markets throughout the World every day. NASDAQ has moved the stock markets into the future. NASDAQ was created by the Financial Industry Regulatory Authority and The National Association of Securities Dealers. NASDAQ is unique because instead of relying on a physical location, all of the trading is performed electronically on a network of computers. NASDAQ has influenced a new era of innovation and expansion.

Looking Ahead To The Future

Stock markets are an important part of the World’s economy. Analysts feel that we will continue to see mergers among different stock markets. There is even an outside chance of a single global stock market. The recent natural disasters that have occurred have also challenged the stock market. While Hurricane Harvey has caused lots of damage, the stock markets have shown growth in these damaged areas. This is another example of how the stock market is relatively immune to the impact of natural disasters. Investors are aware of the economic growth that will take place in the aftermath of these disasters because there will be a lot of jobs created through rebuilding the damaged areas.

Nicholas Fainlight: Blockchain for Businesses

Blockchain for Businesses: How Major Businesses Utilize Blockchain

Blockchain technology is becoming mainstream. In early 2016, more than 40 major financial institutions were experimenting with blockchain, as reported by Wall Street. What does this mean? And how can blockchain help businesses work more effectively?

To answer this, we first have to understand what blockchain is. In the past, transactions of wealth or property have always had to go through a third party middleman. For example, if you were to send someone money over the Internet, that money would be processed through your bank. But with blockchain, such transactions are possible without an intermediary. In addition to transferring money, blockchains can transfer online representations of other types of property.

Blockchain is still a relatively new concept, but if it is utilized widely enough, it can have many benefits. Here are a few:

More certainty in transactions

Transferring through a third party allows a certain amount of trust. If you are being paid for a product, for example, you need to trust that the payee has the necessary funds in their bank account. With blockchain, this is not an issue, because the transaction is immediate.

Records movement of assets

Businesses that deal in supply chains can see a detailed record of how assets move through those chains. Blockchain transactions are stamped with a time, date, and location. Companies can use this information to keep track of expenditures and profit, as well as verify the legitimacy of their product. For example, Walmart has been using blockchain to track certain food items. This allows it to ensure that the food is coming from where it is supposed to be coming from—increasing food safety.

Simplifying the stock exchange

Currently, exchanging stocks requires the verification of multiple parties, with no transparency between them. Blockchain can simplify this process, by providing a secure, accessible, and permanent way for transfers to be made over the Internet.

On a slightly smaller scale, crowdfunding sites suffer some of the same transparency issues as the stock exchange, and also stand to benefit from blockchain.


Sites such as Boardroom and BitShares allow people to vote in an easy, fair way using blockchain. These elections benefit from blockchain’s immediacy and transparency. Currently, blockchain is only in use for small-scale decision-making, within companies or other such organizations, but if it becomes widespread enough, it could present a promising new way to vote in governmental elections as well.

Currently blockchain hasn’t entirely caught on yet. Its novelty means that many companies are suspicious of it security. Some firms also worry that it will disrupt their current business models, precisely because of the way it eliminates the middleman. However,  blockchain is still very early in its existence, and many of its potential applications haven’t been invented yet. So it’s a safe bet that, sometime in the future, blockchain will be a standard means of exchange for companies, and perhaps, for the world at large.


Nicholas Fainlight- Futures Trading

Futures Trading Part 4: Stops and Rolls

If you’ve stuck it out this long, I commend you. Just kidding- hopefully you’ve enjoyed my four-part series on futures trading! If you stumbled upon this blog by chance and don’t know what I’m talking about, TURN BACK NOW. Not actually- but if you want a full understanding of futures trading, I suggest you start from the beginning with Futures Trading 101. This is the fourth and final section of my series on futures trading. We just looked at the risk associated with futures trading and the considerations you should make before investing in a contract, so now we’ll take a look at stops and rolls.

Stops and rolls kind of reminds me of the stop, drop and roll fire safety technique kids are taught in elementary school. The kind I’m talking about are a little different, but they’re also a safety tactic, as they go along with risk management.

Stop orders (stops for short) are a tool that investors can use to practice risk management in futures trading. They are a way for traders to buy or sell at a set price in order to limit losses and secure gains. The idea of a stop order, according to financial analysts Richard Illczyszyn, is to take the emotion of the trade by helping you set forth a plan of how much you’re willing to lose and how much you hope to gain. Stop orders allow you to back out of a trade at a set level and cut your losses to avoid substantial loss of money. In addition to having a set level at which to back out in mind, traders can also place physical stop loss orders when entering a trade that will automatically terminate the contract if the level you choose fails. It’s important to note, Investopedia states, that stop orders are not failsafe: in volatile markets, they could fail to execute at your desired level, causing you to lose more than intended.

Another movement in futures trading is rolls. Just as the basic meaning of stop orders is obvious, rolls are just what they sound like. Futures contracts have set expiration dates, so when you reach the end of your contract, you have a decision to make: do you want to close out or roll over into another expiration date? If you decide to close your position, you have the option to sell the futures you own or purchase the ones that you’re short. If you let your position roll over, then you need to close your current position and open a new one with a new contract with a longer expiration date, allowing your trade more time to succeed.

Anthony Grisanti, founder and president of GRZ Energy, advises giving yourself plenty of time (at least two weeks) to formulate a strategy if you decide to roll over your position. “That way, you can take stock of the market dynamics and not feel rushed as you manage your positions,” he says.

It’s also important to realize that there will sometimes be a roll cost associated with rolling your position to a further date, which is a normal consequence of rolling a position, as multiple variables such as market conditions, storage costs, interest rates, and dividends can cause the value of a contract to increase. A roll cost is simply the price of maintaining one’s position in a later month.

Well, this is where I leave you. I hope that I’ve provided you a strong foundation from which to continue your study of futures trading. My guide is by no means exhaustive, so I encourage you to explore other resources in your quest for trading knowledge.


Futures trading part 2- leverage (1)

Futures Trading Part 3: Risk

If this is your first time tuning in, then you’ll probably want to check out my first two blogs in this futures trading series first, where I cover a basic introduction to futures trading and leverage. I’ve had an interest in futures trading for about as long as I’ve had an interest in finance- which is to say, it’s been awhile. It’s a tricky area of the stock market to explain to anyone because it is both a part of and separate from the overall stock market. Long story short, futures contracts have set expiration dates and stocks do not. But there’s a lot more to it than that, so I broke my explanation of futures trading into four sections covering key concepts. This is lesson three of four, covering risk.

Risk: you know what it is in general terms, but do you know how it relates to futures contracts? Unless you study the stock market as I do, probably not, but I’ll do my best to explain. Essentially, investing in futures contracts can be risky business. Managing risk is an important consideration for stock investment; however, unlike with traditional trading, with futures trading you can stand to lose more money than you put in. Therefore, you should have a full understanding of risk capital before trading in futures.

Risk capital is defined as the funds that traders can afford to lose. According to Rich Ilczyszyn, CEO and founder of, “You should not be trading futures with money reserved for necessities, such as housing, food, transportation.” Instead, you should consult an experienced broker to help you develop and assess your risk profile, and determine the right asset classes.

To know what you’re getting yourself into and avoid trading with risk capital, there are several considerations that should factor into your decisions before trading in futures. First, do your research and go with an experienced brokerage firm. Commission rates, margin requirements, level of executions, types of trade, software and user interface, and customer service are all important considerations. Also consider the level of service you require. If you’re more of a do-it-yourself person, then you may want to save yourself some money and go with a discount broker for lower commissions and fees. However, if you’ve never traded in futures before (or any stocks) then a full-service broker may be for you, as they will provide a higher level of service and advice for a slightly higher cost.

Your next considerations should be the category and type of futures that you want to trade. There are various categories involved in the futures market, which Investopedia suggests thinking of as industries. The individual contracts within these categories can be compared to stocks. For instance, agriculture energy, equity index, currency futures (FX), interest rates, and metals are all categories and there are contracts within those categories. As a general rule of thumb, you should stick to what you know when deciding which market categories and instruments you will trade. If you have a background in agriculture, for example, then you might want to trade in that category since you already have an understanding of the market.

There are also different types of trades to consider. At the most basic level, you can either buy or sell futures contracts, but there are different trading techniques employed by futures traders, starting with basic trades whereby the trader makes a wager that the price difference between investment and futures will fluctuate, and encompassing spread trades (a wager that the price difference between two futures contracts will change) and hedging (where a trader sells a futures contract to protect against a stock market decline).

My explanation of risk management in futures trading is by no means exhaustive, but hopefully it makes you realize that there are a lot of important considerations that go into futures trading and encourages you to do your research before committing to a contract.

Futures trading part 2- leverage

Futures Trading Part 2: Leverage

I promised I would give you a four-part series on futures trading, and I always deliver on my promises. So ta-da, here it is for those of you who have an interest in the stockmarket like I do. In my first post about futures trading, I gave a general introduction to this area of the stock market, where I described what futures contracts are and how they work. As a refresher, a futures contract is a standardized forward contract between a buyer and a seller in which the delivery and payment of the asset occur at a future point in time. Because futures are functions of underlying assets, they are derivative products, meaning they derive their value from the price movements of the various assets they pertain to.

Leverage is a key concept of futures trading, and anyone looking to get into this field should have a thorough understanding of it. According to Rich Ilczyszyn, CEO and founder of, “Leverage allows traders to make a large investment in a commodity using a comparatively small amount of capital.”

So, an investor that is interested in buying or selling a futures contract does not need to pay for the whole contract upfront; rather, they can make a small investment to stake a claim in the commodity. Investopedia gives an example to demonstrate this principle at work in the stock market: Say you have a contract valued at $350,000. This value of the contract, which trades on the CME, is derived from the level of the S&P 500; it is $250 times this level. If the S&P is at 1400, the value of the futures contract is $250 X 1400, which comes to $350,000. A person looking to initiate a trade on this contract does not need to pay the $350,000 upfront, however; they only need to post an initial margin of $21,875 (according to current CME exchange margin requirements).

Now, where leverage comes in: if the level of the S&P 500 happens to increase, then the value of the contract also goes up, and the investor makes a profit. In the example given, if the S&P rises to 1500, then the contract increases its value to $375,000, and the investor makes a $25,000 profit off their initial investment.

The investor also has a chance of losing money if the S&P falls and being hit with a margin call, requiring them to deposit more funds into their account to bring the balance back up, so risk is involved. Nevertheless, the chance of making such a large profit with a relatively small investment (leverage) is what makes futures trading so appealing.

Next time, I’ll go into more detail on the risk involved with futures trading.

Futures Trading 101-Part 1: What is Futures Trading?

I recently published a blog post covering an introduction to the topic of futures trading, one of my personal favorite areas of finance. This is going to be part of a four-part series focused on the following:

  1. Intro: What is futures trading?
  2. Leverage
  3. Risk
  4. Stops and rolls/conclusion

For the original post, please follow the link here. The rest of this series will be published on this new blog dedicated to macroeconomic trends.

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