Alphabet Trading forecasts and signals

The British regulator has launched an investigation into the dominance of technology titans Amazon, Microsoft and Google in the field of cloud services. The watchdog will assess how well the market is performing and will also examine barriers to new entrants in the sector.According to Ofcom, Amazon Web Service (AWS), Microsoft Azure and Google, called "hyperscalers" because of the size of the data centers used to process and store data, share about 81 percent of revenue in the U.K. cloud market.The investigation, which will last up to 12 months, seeks to "ensure that digital communication markets work well for people and businesses in the U.K.," the regulator said in a statement. It will work closely with the Competition and Markets Authority (CMA) and intends to consult on interim findings and publish a final report within a year.If competition is found to be disturbed and that companies and consumers are affected, Ofcom can take enforcement action, recommend regulatory or policy changes to the government, or refer the matter to the CMA for further investigation.Ofcom also plans to launch a broader investigation into messaging services and devices for accessing audio-visual content, including WhatsApp, FaceTime and Zoom, to see how they affect traditional telecommunications services such as calls and messages.The use of cloud services has increased dramatically in recent years. In 2018, less than 10 percent of all global enterprise IT spending was on public cloud services, but that figure rose to 17 percent last year as more people worked from home due to the pandemic. According to Ofcom, some experts expect that amount to reach 45% of enterprise IT spending by ...

The Australian Antitrust Authority reported that the country's Federal Court ordered Google (a subsidiary of Alphabet Inc) to pay a fine of 60 million Australian dollars ($42.7 million) for misleading users when collecting their personal location data.The court found that Google misled some customers about personal location data collected using their Android mobile devices between January 2017 and December 2018.Google misled users into believing that setting up "location history" on their Android phones was the only way to collect location data, whereas the web and app activity monitoring feature also allowed collecting and storing this data.Google Type C shares on NASDAQ on August 11 fell by 0.69% to $119.82 per paper, and on the premarket on August 12, they are currently adding 0.73% to ...

The revenue of Alphabet, Google's parent company, increased by 13% YoY, to $69.7 billion. This value turned out to be almost at the level of the consensus forecast, which assumed revenue growth to $69.8 billion. Without the negative impact of exchange rates, the growth rate of the indicator would have been 16%. Alphabet's operating profit was $19.45 billion against the consensus forecast of $20.14 billion. The operating margin decreased from 31% to 28%, while investors expected a less severe decline – up to 29%. The decrease in marginality is explained by an increase in R&D and marketing expenses, mainly due to an increase in the number of employees and the wage fund. Over the past quarter, the company hired about 10 thousand specialists, and over the year the number of employees increased by 21%. Amid macroeconomic uncertainty, Alphabet plans to slow down the pace of hiring. The GAAP EPS indicator was $1.21, which was lower than the expected $1.27, including due to a loss on non-core activities.Advertising in the search engine, Google Maps and other services (Google Search & Other segment) brought the company $40.69 billion against the consensus forecast of $40.31 billion. The key segment pleasantly surprised investors. The results were better than Snap and Twitter, which presented weak quarterly reports last week. It should be noted that Alphabet receives some benefit from Apple's changed privacy policy, since advertisers can enjoy relatively higher efficiency of advertising campaigns in the Google search engine. The impact of macroeconomic factors was not so strong, so the worst fears of investors were not justified.As the management noted, the advertising segment on YouTube has felt the negative impact of a number of factors that are "difficult to disaggregate." In this quarter, the platform's advertising revenue growth was only 4.9% YoY, while it reached $7.34 billion, although the consensus forecast assumed revenue growth to $7.52 billion. The low rate of revenue growth is largely due to the effect of a high base – in the second quarter of 2021, advertising on YouTube jumped by 84% YoY, and now we see the normalization of the trend. We continue to positively assess the long-term potential of the segment due to the long-term trend of shifting budgets from traditional TV.The operating loss of the Google Cloud segment was higher than expected – $858 million against a projected loss of $788 million. Revenue increased by 35.6% YoY, to $6.28 billion, being $130 million below the consensus forecast. We suspect that not very strong results are caused by an aggressive pricing strategy compared to competitors, which is aimed at getting more contracts, but with low margins. The growth rate of the segment slowed down compared to the previous quarter (then an increase of 44% YoY was recorded), while the results were weaker than those of Microsoft's cloud segment, whose revenue grew by 46%. We believe that in the near future, the results of Google Cloud will not serve as a driver for the growth of the company's ...

The session on July 25, the main American stock exchanges ended in different directions. The S&P 500 rose 0.13% to 3,967 points. The Dow Jones gained 0.28% and the Nasdaq lost 0.43%. The energy sector took the lead in growth (+3.71%), while the sectors of cyclical consumer goods (-0.85%) and IT (-0.61%) were lagging behind.Company newsThe head of World Wrestling Entertainment (WWE: +8.5%) Vince McMahon has resigned.The stock quotes of Emergent BioSolutions (EBS: +6.2%) rose on the WHO statement on the global emergency situation due to the spread of monkey pox.The SEC is checking the Coinbase crypto exchange (COIN: -5.3%) on suspicion that it allowed US citizens to trade unregistered securities.We expectNY Times reported increased concern in the Biden administration about Beijing's statements and actions regarding Taiwan. There is an opinion that the PRC may try to encroach on the independence of this state in the next year and a half. Concerns have intensified over China's threats against Washington over the planned visit of House Speaker Nancy Pelosi to Taiwan. Analysts suggest that Beijing may go for a demonstrative military response, but will not provoke a larger conflict. At the same time, the refusal of the Speaker of Congress from the visit will be perceived by Beijing as a sign of US weakness. As for the economic consequences of these disagreements, first of all, the escalating conflict may put serious pressure on semiconductor manufacturers.Trading on July 26 on the sites of Southeast Asia ended in different directions. China's CSI 300 rose 0.79%, Hong Kong's Hang Seng gained 1.86%, and Japan's Nikkei 225 dropped 0.16%. EuroStoxx50 has been losing 0.2% since the start of trading.Brent crude futures are quoted at $102 per barrel. Gold is trading at $1,722 per troy ounce.In our opinion, the S&P 500 will hold the upcoming session in the range of 3940-3990 points.MacrostatisticsToday, data will be presented on the consumer confidence index for July (forecast: 98 points against June 98.7) and on home sales in the primary market for June (forecast: 665 thousand after 696 thousand a month earlier).Sentiment IndexThe sentiment index rose 1 point to 35.Technical pictureThe S&P 500 has come out of the "bearish" corridor, but it is difficult to predict how long this rebound will last, since in the short term, the movement of the benchmark will be determined by macroeconomic, not technical factors. The MACD signals the continuation of movement in the local ascending channel, the RSI is in a comfortable zone.ReportsAlphabet (GOOGL) will present quarterly reports on July 26. According to forecasts, the corporation's revenue will grow by 13% YoY, to $69.9 billion. The indicators of the cloud computing segment (Google Cloud) will continue to increase most actively: revenue in this area may increase by 38% YoY. The focus will be on advertising revenue. We believe that Alphabet's results will be better than those of Snap and Twitter, which presented weak quarterly reports last week. It should be noted that Alphabet receives some benefit from Apple's changed privacy policy, since advertisers can enjoy relatively higher efficiency of advertising campaigns in the Google search engine and on the YouTube platform. Nevertheless, the balance of risks according to Alphabet's indicators is still shifted in an unfavorable direction due to the potential impact of high production costs on advertisers. The dynamics of the shares will be determined by the statements of the management at the conference call, the assessment of macroeconomic factors by the management of the corporation is especially ...

The session on July 22, the main American stock markets ended with a decline. The S&P 500 dropped 0.93% to 3,962 points. Nasdaq lost 1.87%, Dow Jones - 0.43%. Only three of the 11 sectors included in the broad market index closed in the black. The utilities sector has become the leader of growth (+1.37%). The communications sector was among the outsiders due to weak corporate reports (-4.33%).Company newsSchlumberger (SLB: +4.3%) exceeded revenue and EPS forecasts for the second quarter. The guidelines for the revenue growth rate have been raised with a fixed increase in exploration and production costs.Intuitive Surgical's revenue and earnings per share (ISRG: -5.7%) for April-June fell short of consensus due to a reduction in revenue from sales of surgical systems. At the same time, the annual growth forecast for the volume of procedures has been increased.Snap (SNAP: -39.1%) reported slightly worse than expected and refrained from forecasts due to uncertainty related to changes in Apple's privacy policy, the difficult macroeconomic situation and competition with TikTok.We expectDuring the upcoming trading session, investors will be cautious. The new week will be marked by two important events for the market - the Fed meeting and the publication of preliminary data on the dynamics of US GDP for the second quarter. The FOMC is expected to raise the rate by 75 bps. The most interesting for investors are the regulator's plans regarding the rate movement at the autumn meetings.There are not many reasons for the market participants to be positive. The leading indicators published last week again signaled the risk of recession. The US PMI index in the service sector declined for the first time in two years, and the number of initial applications for unemployment benefits for the week reached an eight-month high. Among corporate comments, there are more and more reports of a slowdown in hiring and even staff cuts.The focus by the end of last week turned to the topic of consumer sustainability, as AT&T reported that customers are paying bills a little later than usual. At the same time, Verizon stated that it does not observe anything like this, and the banks' comments on consumption were optimistic. Developers note some cooling of demand in the housing market, while the number of new construction projects is declining for the second month in a row. The publication of quarterly Bigtech results scheduled for this week can dot the I in this reporting season. These releases will give the market more information about consumer and corporate demand against a changing macroeconomic background.Trading on July 25 on the sites of Southeast Asia ended in the red. China's CSI 300 fell by 0.6%, Hong Kong's Hang Seng lost 0.22%, Japan's Nikkei 225 fell by 0.77%. EuroStoxx50 has been losing 0.12% since the start of trading.Brent crude futures are quoted at $103 per barrel. Gold is trading at $1,727 per troy ounce.In our opinion, the S&P 500 will hold the upcoming session in the range of 3900-3960 points.MacrostatisticsThe publication of significant macro data is not scheduled for today.Sentiment IndexThe sentiment index remained at 34 points.Technical pictureThe S&P 500 bounced off the upper boundary of the correction corridor and may continue its downward movement. The MACD does not signal a reversal yet, the RSI also indicates the development of an upward momentum. The nearest support for the broad market index is located at the intersection of the trend and correction channel at the level of 3800 points.In sightThe leader of the online advertising market Alphabet (GOOGL) will present quarterly reports on July 26. According to forecasts, the corporation's revenue will grow by 13% YoY, to $69.9 billion. The indicators of the cloud computing segment (Google Cloud) will continue to increase most actively: revenue in this area may increase by 38% YoY. The focus will be on advertising revenue. We believe that Alphabet's results will be better than those of Snap and Twitter, which presented weak quarterly reports last week. It should be noted that Alphabet receives some benefit from Apple's changed privacy policy, since advertisers can enjoy relatively higher efficiency of advertising campaigns in the Google search engine and on the YouTube platform. Nevertheless, the balance of risks according to Alphabet's indicators is still shifted in an unfavorable direction due to the potential impact of high production costs on advertisers. The dynamics of the shares will be determined by the statements of the management at the conference call, the assessment of macroeconomic factors by the management of the corporation is especially important.Apple (AAPL) will publish its quarterly report on July 28. According to the consensus forecast of FactSet, the company's revenue will grow by 2%, and adjusted EPS will decrease by 11%. However, actual results may differ significantly from market expectations, as high uncertainty remains in the industry. Some indicators may experience pressure due to the lockdown in China, which partially occurred during the reporting period. In addition, Apple's management did not give its own forecasts for April-June when publishing the results for the first quarter. According to the findings of industry research agencies, Apple's sales of smartphones, PCs, and mobile applications are better than those of its competitors. We expect sales volumes to grow in these segments in the range of 1-5% and forecast the strongest sales results in the segment of services, watches and other wearable devices, and the weakest in the segment of tablets. Despite the weakening of demand, a reduction in the shortage of semiconductors will be a positive factor. For investors, the most important metrics in the Apple report will be marginality indicators. Also of great interest to the market are the forecasts of management regarding sales for the current quarter and until the end of the year.The largest integrated oil and gas company in the United States, ExxonMobil (XOM), will release quarterly results on July 29. Average prices for oil and gas in the States in the second quarter increased by 15% and 64% QoQ, respectively, wholesale prices for gasoline and diesel increased by 30% and 31%. With this in mind, we expect record results from ExxonMobil. In particular, we forecast revenue growth of 64% YoY, to $111 billion, with an increase in adjusted net profit more than tripled year-on-year, to $3.8 per share. Net debt may decrease by $5-6 billion. The parameters of the share repurchase in the second quarter and the forecast by the end of the year will be of interest to investors. Recall that in 2022-2023, ExxonMobil plans to spend $ 30 billion on buy back (about 8% of the current capitalization). We expect a positive market reaction to the company's reports, but XOM shares, in our opinion, have limited growth potential from current ...

On July 15, the shares of the technology giant Alphabet (Google's parent company) will be split in a ratio of 20 to 1. Investors will see 20 times more shares on their accounts, while the value of each will be 20 times lower.A stock split is a fairly common situation in the stock market. One share is split into 20 pieces in order to make them 20 times cheaper, so that it is possible to attract large amounts of investment from individuals who are unable to buy them at the same cost. Yesterday, the shares were trading at $2207 apiece, and they will cost $110.3, their trading volumes should increase against this background.Nothing will change for current and future shareholders, the capitalization of the company will remain the same. However, it will now be easier for investors to add Alphabet shares to their long-term portfolios, including retirement savings.Alphabet had previously split once in April 2014. But then the ratio was different: every 1,000 shares of GOOGL were divided into 1998 shares. Then the volume of shares increased, but the price practically did not change, that is, the split increased the value of the company's ...

Google, owned by Alphabet Inc, has agreed to pay $90 million to settle a legal dispute with app developers. Earlier, developers accused Google of using agreements with smartphone manufacturers and technical barriers to make most payments through its Google Play payment system, for the use of which you have to pay a commission of 30%.In addition, Google said it would charge developers a commission of 15% of their first million Google Play Store revenue each year. This began to be done in 2021.As part of the proposed settlement, Google said it would invest $90 million in a fund to support app developers whose annual revenue in 2016-2021 was $2 million or less. The court must approve the proposed agreement.According to Hagens Berman Sobol Shapiro LLP, which represented the interests of the plaintiffs, 48 thousand application developers could apply for $90 million, and the minimum payout amount is $ 250.At the moment, in Washington, Congress is considering a bill that obliges Google and Apple to allow side loading or the practice of downloading applications without using their own stores. Google claims it already allows side loading. The new bill will also prohibit companies from requiring app developers to use Google and Apple payment systems.This is great news for American app developers. Google probably compromised and reached a settlement agreement with application developers without waiting for Congress to pass an appropriate antitrust law, which would probably provide for much larger fines for monopolists than the $90 million paid by Google to developers. Now we can expect the same compromise from Apple, which has already been fined in the Netherlands for monopoly. Alphabet's stock quotes on the premarket are growing very moderately ...

Google, Twitter and other technology companies will have to take measures to combat fakes and fake accounts on their platforms in order not to receive a large fine (up to 6% of global turnover) in accordance with the updated code of practice of the European Union. Introduced in 2018, the voluntary code will now become a joint regulatory scheme, with responsibility being shared between regulatory authorities and the signatories of the code.The updated code provides examples of manipulative behavior, such as deepfakes, misinforming information and fake accounts. The signatories of the document will have to fight them and ensure greater transparency in advertising.The decision of the European Commission to fine American social networks if the latter do not fight fake news looks highly politicized and one-sided. Although there is certainly a reason to check the content that is published in social networks. However, for the companies that own these social networks, the news is not too serious, in extreme cases, they will pay fines and will continue to do whatever they want. The shares of these three companies are rising in price today on the premarket in the United States, and this shows how indifferent the market is to the senseless attempts of the European Commission to threaten social ...

Investing in CFDs on shares of well-known companies of the worldCFD is an abbreviation of Contract For Difference. CFD is a financial instrument that allows you to speculate on the difference in the prices of the main asset, which are shares or any other instruments.When trading CFDs, the security or precious metal itself is not purchased. That is, the trader does not receive a part of the company or a physical unit of the precious metal for management. On the one hand, this is a minus. However, a pleasant surprise of CFD trading may be that the trader does not have additional obligations in connection with the ownership of the stock.The opportunities for both buying and selling also apply to CFDs. For example, to make money on the fall in the price of the main asset, a CFD contract is sold.What stocks have become available for trading?Recall that the work is carried out not by the securities themselves, but by contracts for the difference in their prices.Margin leverage and other conditions for trading with CFDsTrading contracts for difference is marginal in nature. This means that a trader can trade CFDs with volumes several times higher than his margin collateral.Read more: What is a Leverage in ForexCommissions and spreads are also characteristic of CFDs. The spread is a natural market phenomenon, namely the distance between the nearest prices of buyers and sellers. Every trader who has ever traded currency instruments or already existing ones on the CFD platform is well familiar with spreads.The transfer of an open position to the next day also entails the write-off or accrual of swaps. The swap table can be found on this page.Time of trading CFDs on sharesSince real shares are traded on physical exchanges, their trading time is limited by the working time of the exchange. This means that, for example, when trading CFDs on Google shares, you need to focus on the working hours of the NASDAQ exchange.Shares of other IT companies - Apple, Microsoft - are also listed on NASDAQ. But IBM is already trading on the New York Stock Exchange - NYSE, which is open from 9.30 to 16.00 local time. NASDAQ also operates during these hours.It is important to remember that exchanges are closed and opened every working day. This means that there is a high probability of gaps - 5 times a week. To prepare in advance for possible price gaps, it is worth following the release of economic news.Read more: What is the New York Stock Exchange (NYSE)Dynamics of stock pricesA new tool in a trader's portfolio is always a good thing, because stocks, for example, show a different price dynamics than currency pairs. The new price dynamics makes it possible to apply other trading strategies.Read more: How to invest in stocks and what you need to knowAs for the time horizons of trading, CFD speculation can be performed on both weekly and minute timeframes, and everything in between. CFD per share is the same instrument, in terms of trading opportunities, as a currency pair. Therefore, both short-term trading and long-term being "in the stock" are possible.The stock market differs from the foreign exchange market by a smaller volume, but a large variety of instruments, as well as by centralization. An important feature of the stock market is that companies whose shares are traded on stock exchanges are grouped into sectors, for example: banking, IT, automotive, oil production, etc. This division into sectors directly determines the trading strategies applied to stocks. For example, some popular strategies involve multidirectional trading in shares of one sector to insure against risks across the sector, or multidirectional trading in different sectors to insure against risks across the market as a whole.Read more: The main components of a Trading StrategyStock chart analysisFor the first time, technical analysis was widely used in stock markets. Then, with the advent of the Forex market, he continued his development on currencies that were more popular among traders for technical reasons.Trading algorithms and Stock marketsFor advanced traders who have a deep understanding of manual trading on other instruments, the appearance of CFDs means new niches for their robot trading algorithms.Read more: Trading robots on the stock ...

The S&P500 index is one of the main and most popular stock barometers of the American market. It can be used to objectively judge what dynamics are developing in the market as a whole, whether the majority of American stocks are declining or vice versa, the market as a whole is growing. This is the main function of the stock index - to demonstrate the overall dynamics of the entire market at once. Moreover, according to the dynamics of the index, which includes almost all sectors of the country's economy, it is possible to judge the overall economic growth and development of the country's economy.The beginning of the calculation of the S&P500 index was laid back in 1957, when the analytical agency Standard and Poor's for the first time began to maintain lists for stocks that formed the basis of the index. From the same period, the official calculation and publication of the index as an exchange barometer of the American market begins.The main ideology of creating the S&P500 index was to make a broad market index that covers all key sectors of the economy and represents them as representatively as possible by the best and largest companies. At that time, the Dow Jones Industrial Average Index was the most popular, but it reflected only the dynamics of the largest companies in the industrial sector, there were separate sectoral indices, but there was no large-scale broad market index for the largest companies in the country.The S&P500 index is the estimated value of a virtual basket of shares of the 500 largest American companies from various sectors of the economy. These are the largest companies by capitalization. The capitalization of all companies included in the S&P500 index, which is essentially the capitalization of the index itself, exceeds $23.16 trillion. This is about 70% of the capitalization of the entire US stock market.However, at the moment, due to the rapid development of financial markets, stock indexes are something more than just market barometers. First of all, this concerns the S&P500 stock index, and in order to understand what the stock index really is now, we will consider with you a few key points about the S&P500 index:Characteristics of the S&P500 indexTypes of the S&P500 indexThe composition of the S&P500 indexStructure of the S&P500 indexCalculation of the S&P500 indexRebalancing the S&P500 indexHow to invest in the S&P500 indexConclusionCharacteristics of the S&P500 indexAs already mentioned, the S&P500 index includes the TOP 500 largest companies by capitalization from various sectors of the economy. But in fact, at the moment the index includes 505 companies and the index is not a static basket of stocks. Its composition and structure are regularly reviewed, companies can be excluded from the index, new ones are added, the weight of a particular company changes. The S&P500 index has quarterly rebalances in March, June, September and December.Read more: How to invest in stocks and what you need to knowThe index is calculated using the weighted average method, and the free-float of companies acts as a weighting factor in the index, that is, the share of their shares in free circulation.The S&P500 index is calculated in several currencies on various exchange platforms. So, in addition to US dollars, the index is also calculated in Australian and Canadian dollars, in Hong Kong dollars, francs, euros, pounds, yen, Singapore dollars, as well as in Brazilian reals and Mexican pesos.Types of the S&P 500 indexThere are also as many as three forms of calculating the S&P500 index. The main index is calculated exclusively based on the price values of the shares included in it, this is an index with the stock ticker SPX, but there are also other calculation options taking into account the capitalization of the dividends of the companies included in the index (ticker SPXT) and the net price and dividend yield of the index, net of taxes (ticker SPTR500N).For clarity of comparison, we can see what kind of profitability all three types of index calculation showed every year since 2008. Total returns is the total return of the index, the price increase plus the company's dividends. Price returns is only the return due to price growth and Net total returns is the total return of the index, both price and dividend, net of taxes.The composition of the S&P500 indexAs already noted, the S&P500 index includes the largest companies by market capitalization, but in the index itself they are still "weighted" by the free-float indicator. Thus, the largest share in the weight of the index is not necessarily occupied by the company No. 1 in terms of market capitalization.At the moment, the company that has the largest weight in the S&P 500 index is Apple (AAPL). The weight of the Epl in the index structure is slightly more than 4%. In general, the first TOP ten companies of the index make up 21.2% of the weight of the entire index.The list of the largest companies, in terms of weight in the index, is as follows:The first places are occupied by Apple (AAPL), Microsoft (MSFT) and Amazon (AMZN), and the world-famous company Johnson and Johnson (JNJ) closes the top ten.Structure of the S&P500 indexRead more: Dow Theory: Six basic principles of Technical analysisIn terms of the composition of the index, the S&P500 index represents all the leading sectors of the US economy:The largest sector in the index is the information technology sector, due to such giants in the index as Google (GOOGL), Apple (AAPL) and Microsoft (MSFT). The second largest sector is the healthcare sector and the third is the financial sector. The lowest weight in the index is occupied by the telecommunications sector, the metallurgy and mining sector, as well as the real estate sector.Calculation of the S&P500 indexBelow we will look at the basic principles of calculating the index. As we have already noted, the S&P500 index differs from many other indices in that the weighting factor for calculating the index is not just the market capitalization of the company, but the capitalization of the free-float, that is, the share of shares that is in free circulation.The free-float indicator for companies can change quite often, therefore, in order to accurately follow the calculation principles, the index needs periodic rebalancing, which, according to the plan, take place once a quarter.In addition, there are separate criteria by which companies, in principle, get into the index, and if they no longer meet these criteria, they are excluded and new ones come to replace them.Rebalancing the S&P500 indexThe company itself, the index operator S&P Dow Jones Indices in its monthly monitoring report on the index defines the following criteria for entering the S&P500 index:criteria for entering the S&P500 indexAll companies in the index must be registered in the United States.The company's market capitalization should be at least $6.1 billion.The number of issued shares in free circulation of the company must be at least 50%.Companies included in the index must be successful and profitable. In particular, a mandatory criterion is that the company must have a profit from operating activities over the past 4 quarters.The index includes only liquid ordinary shares of the company, for which there are high trading turnover and which have a sufficient market trading history.When a company is included in the index, the industry factor is taken into account. In order for the index to be representative and serve not only as a purely exchange barometer, but also reflect the real economic situation, the industries in the index have approximately the same weight as the structure of the real US economy. And this is also guided by the index committee when including new securities in the index.New companies that meet the criteria for inclusion in the index cannot endlessly replenish it, so many companies that largely cease to meet at least one of the described criteria for inclusion in the index are excluded from it. So for the last more than 75 years of the index's existence, more than 1000 companies have been excluded from it. That is, in fact, during this period, the index made two asset turns, and the average period of a company's stay in the index is about 30 years. However, of course, there are many such companies in the index that have been in it since its formation.Based on these criteria, we understand that the companies that are part of the S&P500 index are among the best companies according to key criteria for investors. This is the scale of the company, its profitability, a high free-float, which in fact means low dependence on manipulation and large shareholders, as well as high liquidity of the company's shares. Thus, we see that the S&P500 index was created with the goals of practical investment application.As a result, the index is not a static basket of stocks, but in fact, due to the selection criteria, the process of managed, but long-term investment is carried out in it. That is, this index is a kind of fund with low management activity. However, this leads to the fact that the index actually demonstrates very high and, most importantly, stable results in terms of profitability for long periods of time. That is why 85% of all actively managed funds and managers of trust management strategies cannot beat the S&P500 index in terms of profitability for a long period of time, over 5 years. And only 15% manage to do it.From all this, we can conclude that the S&P500 index itself is an attractive and interesting investment object. Therefore, in the next part of our article, we will look at how you can invest directly in the S&P500 index.How to invest in the S&P500 indexSince the S&P500 index is a purely settlement basket of securities, in fact, it is impossible to purchase the index itself on the exchange. Knowing the composition and structure of the index, you can duplicate it, but due to the number of securities and weight coefficients, in order to duplicate the S&P500 index, you will need an amount of more than a million dollars. This is certainly not suitable for all investors, and moreover, it will be difficult and very time-consuming work, in a constantly changing market, to form a portfolio of 500 securities and at the same time accurately maintain the share of each paper relative to the entire portfolio.Therefore, a number of special tools have been created for investing in the index. Most of them allow you to deal with the stock index in the same way as with a stock, you can buy and sell it literally in two clicks in the exchange terminal.Below we provide a complete list of all available tools for investing in the S&P500 index, and then we will analyze each class of tools separately in detail.List of available tools for investing in the S&P500 index:ETFs for the S&P 500 indexETN on the S&P 500 indexS&P 500 Futures and OptionsNext, we will consider each class of tools in more detail.Read more: What are futures: types, features, advantages and risksETFs for the S&P 500 indexAn ETF is a traded exchange-traded fund, an ETF is bought on an index, like a regular stock (we wrote more about ETFs in this article). This is the most affordable and most popular way to invest in the index. ETFs on the index can be from different ETF operators and can be of different types. ETFs that pay dividends and clearly repeat the price movements of the index and ETFs that reinvest dividends and essentially repeat the S&P500 index with the ticker SPXT are an index that is calculated taking into account dividends.ETFs for the S&P 500 indexIn any case, the main feature of an ETF is that its task is to track the index values as accurately as possible and this is a way of investing that almost directly brings the investor closer to the same way as completely duplicating the index with a basket of securities. Moreover, there is almost a real duplication of the index, since the ETF operator management company physically buys shares in the necessary proportions and constantly monitors and balances the portfolio so that it corresponds to the index value as accurately as possible. And the ETF itself is only a tradable part of a global fund of securities with an index structure. In practice, the discrepancy between the values of the index itself and the ETF of the traded ETF for it is only a few points.ETFs for the S&P500 index are traded on various major global platforms in America, Europe and Asia. The largest and most famous platform where ETFs are traded is the NYSE Arca section of the New York Stock Exchange. By the way, the most liquid instrument in the world with the highest trading turnover is currently traded there – this is the SPDR SP 500 ETF Trust (ticker SPY).Read more: What is the New York Stock Exchange (NYSE)ETN on the S&P 500 indexETN (Exchange trade notes) – a traded exchange note. This is a very young financial instrument that has not yet received such a wide distribution as an ETF. From an external point of view, if we compare ETFs and ETNs for the S&P500 index, they are almost 100% identical, but by their nature and form of education they are fundamentally different tools.ETN is a note, which means that it is a debt instrument, similar in nature to bonds. ETN is issued by banks and, in essence, it is a debt obligation of the bank to repay at the end of the note's circulation period an amount equal to or equivalent to the value of the S&P500 index.From the point of view of investors in the index in the case of ETN, the main thing is to understand the main features of investing in this tool:ETNs will 100% accurately repeat the dynamics of the S&P500 index, since it is not based on real assets that require rebalancing and adjustments – this is the bank's debt obligation, which is calculated exactly with the value of the S&P500 index;The difference in risks. If an ETF operator leaves the market, then this practically does not carry a significant risk for investors, since any ETF is based on a real basket of securities, which will then be sold and paid out to participants in proportions. Investing in an ETN is taking on the risk of the financial condition of the bank, which may default on an ETN exactly the same as on a bond. At the same time, as a reward, the bank is paid a significantly higher commission for managing the fund than in the case of ETFs.ETNs have their own maturity and are redeemed in the same way as a bond.ETNs are gaining significant popularity in the investment community and are also traded on leading exchange platforms. The main platform where ETNs are traded on the S&P500 index is the Tel Aviv Stock Exchange (TASE).S&P 500 Futures and OptionsThese tools also provide an opportunity to access the purchase of the S&P500, but these tools are still used more by speculative players than by investors due to their nature and calculation properties. We can also say that such instruments carry increased risks of investing in the S&P500 in the form of the emerging leverage effect and require special skills from the investor to correctly and safely invest in the index.S&P 500 Futures and OptionsFutures and options on the S&P500 index are traded on special exchanges - the Chicago Mercantile Exchange (CME - Chicago Mercantile Exchange) and the Chicago Options Exchange (CBOE - Chicago Board Options Exchange).Read more: Chicago Mercantile Exchange (CME): history, structure, advantages and featuresConclusionIf it did not seem simple and attractive to invest in indices in general and in particular in the S&P500 index, it is still worth considering that, firstly, this is primarily a very long-term investment, and secondly, despite the rather strict selection criteria, the turnover of assets in indices is always quite low, it is low in particular in the S&P500 index, which means in practice for an investor investing essentially in a wide market, with all the disadvantages, as well as entire industries and individual companies. Along with the best and most top companies, investors are simply forced to invest in less attractive companies in addition. In this regard, at most market phases, it is a point, selective investment in a portfolio of carefully selected securities that is more effective than a continuous purchase of the entire market.We are supporters, in most cases, of a point-based approach to investing, when it is necessary to form a diversified, but as selective as possible portfolio of ...

The US Securities and Exchange Commission (SEC) is an all - powerful federal body of the United States responsible for full control and regulatory regulation of the securities market and all its participants (exchanges, brokers, market makers, issuers of securities, investors, traders).ContentThe role and significance of the SEC - the main instrument of investor confidence in the USWho is controlled by the SEC?What does the SEC require in its monitoring?The main functions of the SECThe reason for the investigation by the SEC may serve asHigh-profile SEC InvestigationsThe SEC investigation against Elon Musk, the founder of the Tesla CorporationSEC investigation against World Boxing Champion MayweatherSEC and CFTC: What is the difference between the two US federal agencies?SEC and CryptocurrenciesSEC Head office and its organizational structureThe first and most criticized head of the SEC in the history of the United StatesFailures in the work of the SECThe role and significance of the SEC - the main instrument of investor confidence in the USRoosevelt's "New Deal" from 1933 brought the country out of the "Great Depression" (1929-1932) and became the starting point for the transformation of the United States into a "superpower". The key link of the reforms was not the abolition of the "prohibition law" and the construction of autobahns with a sharp reduction in unemployment (as modern economists write about), but the creation of a mechanism for long-term and STABLE investment attraction in the American economy through "full protection of investors' rights" by the state.This process was controlled by the federal agency SEC, which received DICTATORIAL powers from the moment of its establishment (1934) to this day.What are the results of the SEC's work over 85 years to protect the interests of investors? Look at the capitalization of the largest American stock exchanges - NYSE $32 trillion. (September 2018) and NASDAQ - $7 trillion (2018).Is it a lot or a little? This is 3 times more than China's GDP in 2018. Such a large-scale attraction of investments in the United States was largely due to TRANSPARENCY and guarantees, which are guarded by the SEC, it is not for nothing that 54% of Americans invest their savings in the American stock market.Read more: What is the New York Stock Exchange (NYSE)Who is controlled by the SEC?The US Securities and Exchange Commission controls1. ALL participants of the financial markets, namelyall stock and commodity exchanges-NYSE, NASDAQ, CME, SWOT, SVO, NYMEX, ICE, COMEX, MGEX, BATS Global Markets, etc.OTC markets, including OTC Markets Group and OTC Bulletin Board;all issuers of securities that issue shares, bonds and derivatives of their enterprises on the stock exchanges or on the OTC market;all hedge funds (including Buffett and Soros funds);all financial asset management holdings (BlackRock with a capital of $6 trillion, The Vanguard Group with $4.8 trillion, JPMorgan Chase with $2 trillion, etc.);exchange-traded ETF funds that copy the investment portfolios of the largest stock indexes (iShares with assets of $1.21 trillion, State Street (SSGA) with $546 billion. etc.);investment banks;brokers,market makers.2. ALL securities and financial instruments: shares, options, stock futures, promissory notes, swaps, checks, bills of lading, warrants, investment units, trust, deposit and savings certificates, etc.Read more: What are futures: types, features, advantages and risks3. ALL investors who, in the case of buying 5% of the shares of any company on any of the US exchanges, are required to register with the SEC.4. ALL successful traders on any trading platform in America. For example, the world champion in trading, Larry Williams, said that he was twice subject to an audit by the SEC and the CFTC, which first froze his trading accounts, then began checking, which, however, he easily passed.Given that ALL the world's corporations issue securities that are listed on one of the US exchanges, guess at once what the SEC REALLY controls? That's right, all global financial flows invested through one or another type of securities (i.e. everything except direct financial transfers from bank to bank, which falls under the monitoring of another US federal agency).What does the SEC require in its monitoring?full transparency and truthfulness of financial reports of all financial market participants;explanations of the logic of making a decision with a large investment;compliance with SEC regulations. For example, since 2017, it is prohibited to have financial relations with Iran, Somalia, Sudan, the DPRK and the Crimea.Read more: How to determine the beginning of the movement of the "bull" market?The main functions of the SECMonitoring compliance with federal laws related to the activities of financial markets.Supervision of activities on the securities market and protection of investors from fraud and manipulation.Control over investors' access to significant financial and other information that public companies are required to provide.Establishing rules for the registration of securities offered for sale, as well as the activities of capital markets and stock exchanges.Supervision of the activities of private regulators, accounting and audit.Control of corporate acquisitions in the United States. For example, in the case of a purchase of more than five percent of the company's equity, the buyer is obliged to inform the Commission about this, since in such a situation there is a risk of absorption.The reason for the investigation by the SEC may serve asFailure to provide important information about securities or misleadingManipulation of the market value of securitiesTheft of securities or client fundsViolation of the principle of fair treatment of the broker-dealer to the clientInsider TradingSale of unregistered securities.High-profile SEC InvestigationsThe scale of the SEC investigation is visible from statistics: in 2018 alone (the reporting period from September 2017 to September 2018), the SEC opened 490 cases, issuing fines totaling $3.95 billion! The figure is comparable to the GDP of Montenegro or the Maldives for the same year.Here are some examples to understand who is fined by the US Securities and Exchange Commission and for what.Read more: Swaps in the financial market. What are they and what are they given to the traderThe SEC investigation against Elon Musk, the founder of the Tesla CorporationIn 2018, the SEC fined Tesla founder Elon Musk $20 million for a tweet about "wanting to buy back all Tesla shares". The shares immediately jumped in price, and the SEC launched an investigation as a result of which it found out that Musk had neither financial capabilities nor intentions that he publicly announced. The result: a fine for "manipulation on the stock exchange" and a temporary ban on staying on the board of directors of your own company.The Tesla corporation was fined separately for the same amount.SEC investigation against World Boxing Champion MayweatherIn 2018 SEC fined $614.7 thousand to multiple world boxing champion Floyd Mayweather Jr. He was accused of covertly promoting the ICO of Centra Tech. Yes, yes, that's right. The famous athlete in his social network account "forgot" to warn subscribers that he received money from Centra Tech for advertising their crypto project when he wrote that he considered their tokens "promising for investment".Mayweather did not agree with the accusation, but he paid the fine...Hollywood stars earn money from advertising, but each of their videos has a "advertising" bar and shows a story in the "advertising" section, and not financial news with a story about how the "star" successfully trades on the financial markets with a particular stock or currency broker. And this is clearly and objectively monitored by the SEC.Read more: What is an ICO?SEC and CFTC: What is the difference between the two US federal agencies?In 1974 the US Congress organized the 2nd federal agency - the CFTC (Commodity Futures Trading Committee), transferring part of the powers of the SEC to it. The boundary of powers concerned the marketsThe CFTC became responsible for futures (gold, silver, oil, nickel, cotton, wheat, cocoa, etc.) and financial institutions involved in their trading;The SEC is responsible for the stock market and all its varieties of securities.Of course, their functions often overlap. For example, if the bank:issued shares, bonds, promissory notesit is controlled by the SEC;brought a contract/futures of the Canadian dollar or oil to the exchange-this activity of the bank is controlled by the CFTC.SEC and CryptocurrenciesCryptocurrencies were also clearly "divided" between the SEC and the CFTC:the current futures of the Chicago Bitcoin and Ethereum Exchange are controlled by the CFTC;new ICO - SEC.The position on entering the market of new coins was clearly voiced by the current head of the US Securities Commission, Jay Clayton:"If you want to go to the IPO with your token, welcome to us. The SEC will help to conduct a public offering to issuers who are ready to assume obligations in accordance with the requirements of the law."About bitcoin: "If cryptocurrencies, such as bitcoin, act as an alternative to sovereign currencies, such as the dollar, euro, yen, they are not considered a security, unlike a token or a digital asset."About the new cryptocurrencies: "If I give you money for business development, and you promise me to receive some profit in the future for this, then such an asset is already a security and is subject to regulation."As you can see, the position of the US Securities Commission on cryptocurrencies is logical and very transparent. Anyone who wants to issue tokens to the market needs to register with the SEC.Why, according to many analysts, did this position "have a negative impact on the crypto market"? The problem is that only 3% of the owners of new tokens implement their crypto projects according to the promises made during the ICO. Why would 97% of the organizers of new coins need such SEC control if they were just planning to scam investors? The media, of course, voiced completely different reasons.Read more: Who are Market Makers and what are they doing on the market?SEC head office and its organizational structureThe main office of the US Securities and Exchange Commission is located at 100 F Street, NE Washington, DC 20549.The structure of the SEC is quite simple:5 members of the commission (one of them is the chairman of the SEC), who change once a year;5 SEC departments (each headed by a member of the commission) - "corporate finance" (controls the issue of securities), "trade and markets" (supervision of exchanges, brokers and securities traders), "investment management"(reporting of issuers and investor complaints) and "legal application department" (monitoring compliance with the law of all market participants), "economic analysis of markets and risks" (monitoring markets and preparing new legal documents);24 divisions serving 5 departments - judges, inspectors, legal advisers, auditors-accountants, specialists in "ethics (!) of the market", etc.11 regional offices in New York, Los Angeles, Boston, San Francisco, Philadelphia, Chicago, Atlanta, Fort Worth, Miami, Salt Lake City and Denver.All members of the commission are appointed by the President of the country, the Senate approves, but the exchange market regulator remains... an independent structure (like, for example, an American court!).The SEC is a federal body, so its decisions are subject to enforcement throughout the United States of America.The SEC cooperates with all US law enforcement agencies (the prosecutor's office, the FBI, the police, the tax service, etc.), each of which transmits materials to the SEC during investigations concerning financial markets.Read more: Issuer of securities: definition, types and featuresTasks of the Federal Securities and Exchange Commission of the United States:control over all participants and financial instruments of the exchange markets;establishment of rules on the securities market;adoption of new acts of regulation of financial markets when any problem is detected;investigation of any violations in the financial markets.The US Securities and Exchange Commission, with its own staff of judges, independence from other branches of government, full control over all participants and financial instruments of the exchange markets and the annual rotation of one of the 5 members of the Commission.But it was these powers that allowed attracting tens of trillions of dollars of investments to the United States with effective protection of investors ' rights and the annual suppression of hundreds of violations and crimes in the financial markets, regardless of the faces of those who violated the Law and encroached on the rights of investors.The first and most criticized head of the SEC in the history of the United StatesThe first head of the US Securities and Exchange Commission was Joseph Kennedy (1888-1969), the father of the future American President John F. Kennedy. Why is such a term applied to it? Answer the question about the policy yourself, which:became a multi-millionaire at the age of 35 (1923) on the illegal alcohol trade during prohibition (1919-1933);he invested the earned funds in "playing on the stock exchange" and "bold transactions" with real estate, where he again succeeded, dramatically increasing the capital of the "family", miraculously avoiding large losses on "Black Thursday" on October 24, 1929 - the day of the stock market crash of America;after the abolition of Prohibition in 1933, the Kennedy Somerset Importers Corporation received an exclusive (monopoly) to export to the United States a number of brands of alcohol (including John Dewar & Sons Scotch whiskey and Gordon's gin).Compare with the principles for SEC members, according to which "only well-known individuals who have earned an impeccable reputation can become members of the SEC." Of course, the competitors of the Democratic Party, the Republicans, could not ignore this fact, bringing down a whole waterfall of criticism on the new head of the SEC from the pages of The Wall Street Journal and other media close to the Republicans.It is not surprising that Joseph Kennedy worked as the head of the SEC for a little more than a year (July 1934-September 1935), leaving for the post of head of the US Maritime Commission, and in 1938-1940 as the US ambassador to the UK (there Kennedy Sr. again "plunged" into the abyss of scandals.  After the outbreak of the 2nd World War in 1939, the ambassador to Great Britain began to advocate negotiations... with Hitler and banned the issuance of American visas to German Jews who tried to move to the United States).Failures in the work of the SECThe Dotcom crisis is the main shock of the NASDAQ stock exchange, which in March 2000. lowered the NASDAQ Composite index by almost 5 timesThe "Dotcom crisis" gave rise to a fall and a 2-year bear market of all stock indexes in the world, although weaker than it happened on the NASDAQ. So:the NASDAQ Composite stock index fell by 466.54% (by 4132 points);the Dow Jones index by 61.25% (4552 points);the SP 500 stock index increased by 50.18% (782 points).Read more: Bulls and bears, as well as other animals on the stock exchangeThe "Dotcom crisis" is a natural stage in the development of Internet business in the conditions of:the absence of contextual advertising in those years. I.e., website traffic did not make a profit until in February 2002 Google has launched a version of AdWords, through which Internet resources began to receive guaranteed financial income from advertising.market makers were clearly carried away by 2000 in the "promotion" of the bullish trend, increasing and increasing the cost of Internet resources.But, you must agree, these are not the reasons for the financial losses of $5 trillion with the balancing of the US economy on the verge of a new "Great Depression"? Everything will fall into place if you synchronize the dates of the strikes on the exchanges:March 2000 - the dotcom crisis and the beginning of the fall of the markets;December 9, 2000 - hacking of the Nasdaq Stock Market website;September 11, 2001 - terrorist attack on the United States, panic in the markets, closing of trading on the NYSE and NASDAQ.Someone purposefully tried to "drop the markets", cause distrust in the "high-tech sector" (which is the future) by redirecting investments to the real estate and oil markets. As a result, we succeeded - the "soap bubble" in the real estate market began to grow (it burst in the global crisis of 2008), and the bullish trend of oil continued until 2014.Read more: About NASDAQ Stock ExchangeThe SEC tried to reach out to the customers of the 9/11/2001 terrorist attacks, taking into account all market participants who opened large sell orders on the eve of the tragedy, especially for airline shares, which rose strongly the day before (!!), and then fell by 40%. The results of the investigations were not publicly released, as were the conclusions of SEC analysts about the exit to the entire chain of those who earned more than others, first on the fall of the market, and then on the growth of real estate and oil, gas futures, ...