What is Link Retargeting?

To put it simply, link retargeting is just like traditional ad retargeting. The key difference is that instead of having to send customers to your site, you can display retargeted ads based on the link they click. And it can be any link – not just to your website.

Link retargeting really allows you to take your content, social, email, or even AdWords marketing farther! We’ve put together five key tips you need to know to get started.

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Creating Truly Modular Code with No Dependencies

Developing software is great, but… I think we can all agree it can be a bit of an emotional rollercoaster. At the beginning, everything is great. You add new features one after another in a matters of days if not hours. You’re on a roll!

Fast forward a few months, and your development speed decreases. Is it because you are not working as hard as before? Not really. Let’s fast forward a few more months, and your development speed drops further. Working on this project is not fun anymore and has become a drag.

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Maximum Flow and the Linear Assignment Problem

Here’s a problem: Your business assigns contractors to fulfill contracts. You look through your rosters and decide which contractors are available for a one month engagement and you look through your available contracts to see which of them are for one month long tasks. Given that you know how effectively each contractor can fulfill each contract, how do you assign contractors to maximize the overall effectiveness for that month?

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Implementing Serverless Node.js Functions Using Google Cloud

Creating software does not end with writing good code. It gets completed when the software is deployed and able to handle the requests properly and when we can scale without hindering the performance and the cost of running it.

You’re probably thinking about how you have cloud computing to take care of all these things. “So what is this new serverless thing, Vignes?”

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Demystifying Cryptocurrencies, Blockchain, and ICOs

Executive Summary

Cryptocurrency Market Size and Technology
  • The market cap of Bitcoin exceeded $70 billion, with peak trading volumes around $3 billion per day.
  • Technology consulting firm CB Insights has identified 27 ways blockchain can fundamentally change processes as diverse as banking, cybersecurity, voting, and academics.
  • The World Economic Forum estimates that by 2027, 10% of global GDP will be stored on blockchain technology.
  • Most mining pools are located in China, comprising more than 70% of total Bitcoin mining. China manufactures most cryptocurrency mining equipment and leverages the country’s cheap electricity prices.
Types of Cryptocurrencies
  • There are over 1,000 cryptocurrencies in existence right now (called “altcoins”); over 600 have market capitalizations of over $100,000.
  • Bitcoin’s market share has fallen from 81% in June 2016 to 41% one year later, in June 2017. However, Bitcoin’s price has continued to soar.
  • In August 2017, Ether’s market capitalization was around $28 billion. At one point, commentatorsanticipated that Ether’s market capitalization would surpass that of Bitcoin (the “flippening“). However, issues with Ethereum technology have since caused its value to decline.
Investing in Cryptocurrencies
Outstanding Issues
  • Accounting. While the US has been cracking down on unregulated activities, in countries such as Germany and the UK, cryptocurrencies are treated like “private money” and are not subject to tax outside of commercial use.
  • Regulation. New York State created the BitLicense system, mandates for companies before conducting business with New York residents. As of mid-2017, only three BitLicenses have been issued, and a far greater number withdrawn or denied. In 2015, the cost of obtaining a license was estimated to be as much as $100,000.
  • Security. The FTC recorded an increase in identity fraud complaints of more than 100% between 2013 and 2016, and Coinbase, the largest US-based exchange, saw account hacking double just between November and December 2016.

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Should We Rethink the Use of EBITDA?

Key Highlights

EBITDA’s use as a measure of “clean” operating performance is questionable
  • For capital intensive industries, where capex is a fundamental part of standard operating performance, excluding depreciation and amortization does not provide a “cleaner” picture of operating performance. Sprint’s financial results, for instance, swing from $7.4 billion of EBITDA in 2016 to essentially zero EBIT once D&A is taken into account.
  • Similarly, if necessary capex is financed via debt and other financing arrangements, the same can be said about excluding interest expense. Charter Communications, for instance, which financed much of its capex via necessary debt issuance, with one bad year in 2008 where the business didn’t operate efficiently, had to file for bankruptcy despite maintaining positive EBITDA.
  • Finally, excluding tax expense for certain industries where geographical location and/or capital structure are not easily changed (e.g., the defense industry), again distorts, rather than clarifies, the assessment of operating performance.
EBITDA is often a bad proxy for cash flows
  • Comparing EBITDA and operating cash flows for Apple and Exxon, one can see a huge gap between the EBITDA of these companies ($56 billion vs. $95 billion) but not the cash flow from operations ($52 billion vs. $55 billion), which were almost equal in June 2012.
  • Taking the case of La-Z-Boy, the eponymous recliner company, in 2017, the company was able to convert over 90% of its EBITDA into operating cash flows, but in 2015 and 2016 the opposite was true.
EBITDA is sometimes a dubious valuation metric
  • Seth Klarman believes that EBITDA might have been used as a valuation tool because no other valuation method could have justified the high takeover prices prevalent at the time (1980s). According to him, EBITDA overstates cash flow as it does not take into account all the non-cash gains and expenses along with working capital changes.
  • A research paper on valuation analysis at the University of Oxford looks at how Twitter valued itself using adjusted EBITDA, the definition of which excluded depreciation and amortization, interest, and taxes but also stock-based compensation. In fact, Twitter incurred more than $600 million in stock-based compensation expenses in 2014, which was more than 40% of its 2014 revenues.

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Why Investors are Irrational, According to Behavioral Finance

Key Highlights

Overconfidence
  • Investor overconfidence can lead to excessive or active trading, which can cause underperformance. In a 1999 study, the least active traders had annual portfolio return of 18.5%, versus the 11.4% return that the most active traders experienced.
Loss Aversion
  • Fear of loss. When asked to choose between receiving $900 or taking a 90% chance of winning $1000, most people avoid the risk and take the $900. This is despite the fact that the expected outcome is the same in both cases. However, if choosing between losing $900 and take a 90% chance of losing $1000, most people would prefer the second option (with the 90% chance of losing $1000).
  • The “disposition effect” is the tendency of investors to sell winning positions and hold onto losing positions. This effect directly contradicts the famous investing rule, “Cut your losses short and let your winners run.”
Portfolio Construction and Diversification
  • Familiarity Bias. Investors prefer to invest in “familiar” investments of their own country, region, state, or company. Although the best practice is for portfolios to hold at least 300 stocks, the average investor only holds three or four.
Misuse of Information
  • Gambler’s Fallacy. When asked to choose which is more likely to occur when a coin is tossed—HHHTTT or HTHTTH—most people erroneously believe that the second sequence is more likely. The human mind seeks patterns and is quick to perceive causality in events.
  • Attention Bias. A 2006 study posits that individual investors are more likely to buy rather than sell those stocks that catch their attention. For example, when Maria Bartiromo mentions a stock during the Midday Call on CNBC, volume in the stock increases nearly fivefold minutes after the mention.
Cultural Differences in Investing
  • International differences in loss aversion. After controlling for factors such as national wealth and growth, a study found that Anglo-Saxon countries are the most tolerant of loss, while investors in eastern Europe have the greatest loss aversion.
  • International differences in investor patience. The same study found that investors from Germanic/Nordic countries (85%), Anglo/American countries, Asia (66-68%), and Middle East cultures are more willing to wait.

“The investor’s chief problem—and even his worst enemy—is likely to be himself.”
– Benjamin Graham

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