What is hedging?
Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Personal Finance
[Consultation Deadline Oct 7, 2022]: Fighting Predatory Lending by Lowering the Criminal Interest Rate
Department of Finance Canada | Aug 21, 2022
Are you concerned about the criminal rate of interest being too high or low?
Budget 2021 announced the Government of Canada's intention to consult on fighting predatory lending by lowering the criminal rate of interest in the Criminal Code of Canada applicable to, among other things, installment loans offered by payday lenders. The criminal rate of interest, which is currently set at 60 per cent effective annual interest, is applicable to most lending products in Canada. This consultation paper seeks views and feedback on proposals related to the criminal rate of interest and provision of high-cost installment loans in Canada.
Consultation Scope
High-cost installment loans appear to be the most widely held high-cost lending product in Canada. In a recent study conducted by the Financial Consumer Agency of Canada (FCAC), 44 per cent of consumers who had taken out high-cost credit reported taking a high-cost installment loan in 2020.
See: MoneyMates: Slaying predatory lending
The criminal rate of interest in the Criminal Code, which is currently set at 60 per cent effective annual interest, is applicable to most lending products in Canada (e.g. installment loans, lines of credit, auto loans, auto title loans, credit cards, and more). The only exceptions are payday loans (loans for values of $1,500 or less and for a term of 62 days or less) offered by licenced or specifically authorized persons in provinces that have enacted consumer protection laws and where the province has been designated by the federal Governor in Council. Nine provinces have been designated. The Criminal Code provisions governing payday loans are not the subject of this consultation paper.
Specifically, key questions we want to hear from you on include:
- Should the criminal rate of interest be set at a fixed level or linked to prevailing market conditions?
- What are the reasons financial consumers access high-cost installment loans?
- What impact would lowering the criminal rate of interest have on the availability of credit for financial consumers who use high-cost installment loans?
- How could the Government of Canada, including the FCAC, improve financial education and awareness regarding high-cost installment loans to further empower and protect Canadians as they make informed financial decisions?
See: Preparing For a Mortgage? These Tips Will Help You Get the Right Deal
Contact information to participate by email
We also invite you to submit any additional comments or feedback relevant to the scope of this consultation by OCTOBER 7, 2022.
Send us your comments to consultationconsumeraffairs.consultationconsommation@fin.gc.ca with "Predatory Lending Consultation" as the subject line.
View the original article --> here
Read the consultation on fighting predatory lending by lowering the criminal rate of interest --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Should You Be Hedging Your Crypto Trading?
Tristram Waye for Bitvo | Aug 18, 2022
What is hedging?
Hedging is a strategy used by all sorts of market participants. It is widely used in commodity trading, hedge fund, and portfolio management strategies. And you can use it for crypto trading. Hedging is an instrument for protecting capital gains and avoiding losses. You can think of it like a synthetic insurance policy or a risk management technique that can be used in a variety of trading contexts.
It is used extensively by commodity producers and consumers to lock in prices for products to be delivered at some point in the future. Options pros or market makers use hedging to offset the call and put options they sell. Equity traders use option-based hedges to protect up and downside of respective positions. They can also use a replacement strategy for existing positions as a sort of hedge. Large portfolio managers may use a variety of instruments, including index futures, and government securities to protect portfolio downside.
See: Expert Tips and Strategies for Crypto Trading
While bitcoin is sometimes described as a hedge, there are various instances where bitcoin exposure itself could benefit from hedging. The origin of hedging as an idea is old, some say dating back to the 1400s. However, for most, the term is often associated with the hedge fund.
Hedging products for bitcoin and ether
For ETH and BTC, one has a variety of ways to hedge.
- You can buy put options to protect yourself from downside. This means taking on an additional position with a different product without selling the one you already have.
- Or you can sell your position and replace it with a call option instead. The call can be used as an asset replacement position where you can retain exposure for a fee. Your downside will be the premium you pay for the option. But if BTC or ETH goes higher while you own the option, you continue to participate until expiry.
- As we discussed in our options piece, it’s important to understand the contract specs of these products in advance. The specs would include the expiry, delivery requirements (cash or crypto), when you can exercise the contract (American or European style options), and any other specifics.
- The same applies to futures. BTC and ETH futures and mini contracts provide a range of ways to use futures for hedging. These include shorting futures or using options on futures. Again the contract specs are critical to understand before getting involved.
- You might also look for listed equities as proxies for various instruments and easier ways for short exposure. Again, not saying you should do this, but it’s just another way to use an instrument for hedging specific exposure. For example, MicroStrategy could be a good proxy for Bitcoin, given its significant stake. Or you could look at other listed crypto entities like Coinbase.
See: How to get into angel investing with ‘no’ money
…but hedging isn’t free
There are opportunity costs. If you protect the downside of your position and it goes higher, you give some of that up. This is a form of opportunity cost. The premium you pay for an option contract is a cost. There is the potential for slippage. And when you use sophisticated options trading strategies, there are other risks. If you are using futures, there are margin, execution, and opportunity costs. So any time you are thinking about hedging, it’s not just the protection, but the cost of that protection in terms of opportunity cost, slippage and other tangible costs.
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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What You Should Know Before Playing Punto Banco
Guest Post | Aug 18, 2022
Punto Banco is a casino card game that is very popular among gamblers. It is played in casinos all over the world and is considered to be one of the easiest games to learn. A lot of gamblers like playing this game not less than getting free spins. If you are new to gambling, then you should definitely try Punto Banco.
Punto Banco is a very simple game to learn and play. However, it can be quite addictive, and many people find themselves spending hours playing the game.
History of Punto Banco
The origins of Punto Banco can be traced back to Italy in the 1800s. The game was then known as "banca rossa" or "red bank". It is believed that the game was created by a man named Felix Falguierein, who was a professional gambler from Naples. The game quickly gained popularity in the gambling circles of Italy and eventually spread to other European countries, such as France and Spain.
Punto Banco made its way to America in the early 1900s and became one of the most popular casino games in the country. The game really took off in Las Vegas in the 1950s when it was introduced at several famous casinos, such as the Sahara and the Riviera. If you are interested in casinos’ history, check also some best monitor deals to provide better technical conditions for gaming online.
Punto Banco: Setting and Distribution
Punto Banco is a casino game that is played between two hands, known as the "punto" and the "banco". The player who bets on the hand that will have the highest total value at the end of the game is said to have won the "coup".
The objective of Punto Banco is to correctly predict which of the two hands will have the highest total value at the end of the game. The player who makes the correct prediction wins the coup.
The game of Punto Banco is usually played with eight decks of cards. These decks are shuffled together and then dealt out to the players. Each player is given two cards, face down. The Dealer then deals two cards, face up, to the middle of the table, and then two more cards to the bank. These four cards are known as the "flop". These are the community cards, and they are used by all of the players.
The player who has the highest total value after the flop is said to have won the "pot". If there is a tie, the pot is split evenly between the two players.
How to Bet
The object of the game is to bet on the hand that will have the highest total value after all of the cards have been dealt. There are two ways to win in Punto Banco:
- by having the highest total value
- by having the lowest total value
You can bet on either the Player hand or the Banker hand. The Player hand is the one that is dealt first, and the Banker hand is the one that is dealt last. If you bet on the Player hand, then you are betting that the total value of the cards in that hand will be higher than the total value of the cards in the Banker hand. If you bet on the Banker hand, then you are betting that the total value of the cards in that hand will be lower than the total value of the cards in the Player hand.
You can also bet on a Tie, which is when both the Player and Banker hands have the same total value. If you bet on a Tie, then you are betting that neither hand will have a higher total value than the other. If it’s too difficult for you, check also some top real money games on mobile to make things different.
Card Betting Rounds
The player to the left of the Dealer starts the betting. They can either bet on the Player hand, the Banker hand, or a Tie. If they bet on the Player hand, then they are betting that the Player hand will have a higher total value than the Banker hand. If they bet on the Banker hand, then they are betting that the Banker hand will have a lower total value than the Player hand. If they bet on a Tie, then they are betting that neither hand will have a higher total value than the other.
After the first round of betting is complete, the Dealer will deal with two more community cards. These are called the Turn and the River. The player to the left of the Dealer starts betting again.
See: What Was the Rationale Behind Ontario’s Online Gaming Regulation?
This time, they can either bet on the Player hand, the Banker hand, or a Tie. If they bet on the Player hand, then they are betting that the Player hand will have a higher total value than the community cards. If they bet on the Banker hand, then they are betting that the Banker hand will have a lower total value than the community cards. If they bet on a Tie, then they are betting that neither hand will have a higher total value than the other.
The last round of betting is called the Showdown. The player with the highest total value after all of the betting is complete wins the game.
In Conclusion
Punto Banco is a very popular casino game and is enjoyed by millions of people all over the world. The game is easy to learn and can be quite addictive. If you are looking for a fun and exciting way to spend your time, Punto Banco may be the perfect game for you.
Now that you know the basics of Punto Banco, you are ready to start playing. Remember, this is a game of chance, so there is no guarantee that you will win. However, if you play your cards right, you could walk away with a nice profit.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Process Flow Comparison: How VISA Works When Swiping a Credit Card at a Merchant’s Shop VS Digital Wallet
ByteByteGo | Alex Wu | Jul 16, 2022
What happens when you swipe your credit card at a merchant's shop
VISA, Mastercard, and American Express act as card networks for clearing and settling funds. The card acquiring bank and the card issuing bank can be – and often are – different. If banks were to settle transactions one by one without an intermediary, each bank would have to settle the transactions with all the other banks. This is quite inefficient.
See:
FTP Report: B2B Payments: A Major Fintech Opportunity to Solve Paper-based Payments and Processes
Instagram Launches Payment Service for Small Businesses (Directly in Chat)
Crypto Payments Report 2022: How digital currencies are revolutionizing commerce, corporates and culture
Bank of Canada: The Latest on Retail Payments Supervision and Survey
QR Code payment process using your digital wallets, such as Venmo, Paytm, or Paypal
To understand the process involved, we need to divide the “scan to pay” process into two sub-processes:
- Merchant generates a QR code and displays it on the screen
- Consumer scans the QR code and pays
Continue to the full article --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Understand These 7 Things Before You Start Investing in Stocks
Aug 11, 2022
If you're thinking about investing in the stock market, it's important to understand the basics first. In this blog post, we will discuss seven things that you need to know before you start investing. We'll cover topics such as stocks, bonds, and mutual funds, and we'll also give you some tips on how to get started. So if you're ready to learn more about the world of stocks, keep reading!
1. You might need a stock advisor
If you're new to investing, you might want to consider working with a stock advisor. A stock advisor can help you choose the right investments for your goals and risk tolerance. They can also guide when to buy and sell stocks. While there are many reputable stock advisors out there, it's important to do your research before selecting one. You should look for someone who has experience in the market and who is willing to answer your questions. There is also a Motley Fool stock advisor that you can use if you want to educate yourself more on stock investing. Once you've found a stock advisor or a website you trust, they will help you create a portfolio that meets your investment goals.
2. Consider your investment goals
Before you start investing, it's important to take a step back and consider your goals. What are you hoping to achieve with your investments? Are you looking to grow your wealth over the long term, or are you more interested in generating income? Once you know your goals, you can start to create a plan for how to achieve them. For example, if you're aiming to retire comfortably, you'll want to focus on growth stocks that have the potential to generate high returns. On the other hand, if you're looking for immediate income, bonds may be a better option. There are a variety of investment products available, so it's important to choose the right ones for your goals.
3. Determine your risk tolerance
Another important factor to consider before you start investing is your risk tolerance. How much risk are you willing to take on? This will affect the types of investments you make. If you're comfortable with taking on more risk, you may want to invest in stocks. However, if you're looking for stability, bonds may be a better option. When determining your risk tolerance, it's also important to think about your time horizon. If you're investing for the long term, you can afford to take on more risks since you have time to ride out any market volatility. However, if you're looking for short-term gains, it's important to be more conservative with your investment choices.
4. Learn about the different types of investments
There are many different types of investments available, and it's important to understand the basics before you start investing. The two main categories of investments are stocks and bonds. Stocks represent ownership in a company, and they can be bought and sold on the stock market. Bonds are loans that are made to corporations or governments. When you invest in bonds, you're lending money to an entity and receiving interest payments in return. There are also other types of investments, such as mutual funds and ETFs. Mutual funds are collections of different stocks or bonds that are managed by a professional fund manager. ETFs are similar to mutual funds, but they trade on the stock market like a stock.
5. Consider the fees
When you're investing, it's important to be aware of the fees associated with your investment choices. Some investment products come with high fees, which can eat into your returns. For example, mutual funds often have high management fees. ETFs may also have trading fees, and stock commissions can add up if you're frequently buying and selling stocks.
See: Some New Banking Rules Implemented to Protect Consumers in Canada
It's important to compare the fees of different investment products before you choose one. The fees can have a big impact on your returns, so it's important to select an investment that has low fees. It might not seem like a big difference, but over time, the fees can add up and have a significant impact on your returns.
6. Start with a small amount of money
If you're new to investing, it's important to start with a small amount of money. This will help you get comfortable with the process and learn how to manage your investments. Once you've gained some experience, you can gradually increase your investment amounts. Many brokerages have account minimums, so it's important to choose one that fits your budget. The smaller amount will also help you to focus on the long-term goal of your investments, rather than short-term gains. Some people get caught up in trying to make a quick profit, but this can be risky. It's important to think about the long-term goal of your investments and stay disciplined with your investment strategy.
7. Review your investments regularly
Once you've started investing, it's important to monitor your investment portfolio regularly. This will help you to make sure that your investments are performing in line with your expectations. It's also a good idea to rebalance your portfolio from time to time. This means selling some of your winners and using the proceeds to buy more of your losers. This will help you to maintain a diversified portfolio and stay disciplined with your investment strategy. Some people choose to do this every quarter, while others do it annually.
Is it hard to earn money by investing?
Earning money from stocks is not easy. Many people think that they can just buy stocks and wait for the price to go up, but it doesn't always work that way. There are a lot of things you need to understand before you start investing in stocks, such as the different types of stock, how the stock market works, and what factors can affect stock prices. Some people make money from stocks by buying and selling them frequently, but this can be risky. It's important to have a solid understanding of the stock market before you start investing in stocks. Otherwise, you could end up losing money.
Investing can be a great way to grow your wealth or generate income. However, it's important to understand the basics before you start investing. By considering your goals, risk tolerance, and time horizon, you can choose the right investment products for you. It's also important to be aware of the fees associated with different investment products and start with a small amount of money. So, before you start investing, make sure you understand these seven things.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Here Are 10 Tips for Finding a Financial Professional Who May Be The Best Fit For You
Guest Post | Aug 11, 2022
As anyone who has ever applied for a loan knows, online installment loans can be a great way to get the money you need without having to put up your home or other valuable property as collateral. However, finding the right financial professional to help you with your installment loan can be a challenge. Here are 10 tips for finding the best fit for you:
The 10 best tips for finding a financial professional
1. Know what you need
Everyone has different financial needs, so it's important to know what yours are before meeting with any financial professionals. This will help you ask the right questions and find someone who is a good fit for you.
2. Do your research
Not all financial professionals are created equal. Be sure to do your research and read reviews before meeting with anyone.
3. Ask around
Talk to your friends, family, and colleagues to see if they have any recommendations for financial professionals in your area.
4. Meet with several options
Once you've done your research, it's time to start meeting with potential financial professionals. Meeting with multiple people will give you a better idea of who may be the best fit for you.
See: Having a Financial Plan Is More Important Than You Think – Here’s Why
5. Ask lots of questions
This is your financial future we're talking about, so don't be afraid to ask lots of questions! Find out what their experience is, how they would handle your specific financial situation, and what their fees are.
6. Consider credentials
When looking at financial professionals, it's important to consider their credentials. Check to see if they have any certifications or designations that could indicate they're qualified to help you with your finances.
7. Compare fees
Not all financial professionals charge the same fees, so be sure to compare before making a decision. You'll want to find someone who charges a fee that you're comfortable with and who is transparent about their pricing.
8. Get a second opinion
A financial decision should not be made lightly. If you're unsure about something, get a second opinion from another financial professional or even a trusted friend or family member.
9. Read the fine print
Before making any decisions, be sure to read all the fine print. This includes contracts, disclosures, and other important documents. You don't want to make a financial decision without fully understanding the terms and conditions.
10. Trust your gut
At the end of the day, you need to go with your gut feeling. If something doesn't feel right, it probably isn't. Be sure to listen to your intuition when making financial decisions.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Preparing For Retirement? These Useful Financial Tips Will Make Things Easier
Aug 9, 2022
Image/Pixabay
Are you getting ready to retire? If so, it's important to start preparing as early as possible. In fact, the earlier you start, the more likely you are to have a successful retirement. There are many things you can do to prepare for retirement, and in this blog post, we will discuss some of the most important steps. We will also provide helpful tips on how to make the process easier!
Start as Early as Possible
One of the most important things you can do when preparing for retirement is to start as early as possible. The sooner you start, the more time your money has to grow. And, if you start early enough, you may be able to retire earlier than you thought! So, how early should you start?
The answer to this question depends on many factors, including your age, income, and retirement goals. However, most financial experts agree that you should start saving for retirement in your 30s.
If you're in your 30s and you haven't started saving for retirement yet, don't worry! It's never too late to start. In fact, even if you only have a few years left until retirement, there are still things you can do to prepare.
Contribute to Your 401(k) Account
If you're employed, one of the best things you can do to prepare for retirement is to contribute to your employer's 401(k) plan. Most 401(k) plans offer some sort of matching contribution, which means that your employer will match a certain percentage of the money you contribute. For example, if you contribute $100 to your 401(k), your employer may match 50% of that, which means you would end up with $150 in your account. In addition to the matching contribution, 401(k)s also offer tax breaks.
This is because the money you contribute is deducted from your taxable income. 401(k)s are a great way to save for retirement, but they're not the only way. If you don't have access to a 401(k) plan, or if you want to save even more for retirement, you may also want to open an IRA.
Open an IRA
An Individual Retirement Account, or IRA, is a retirement savings account that anyone can open. There are two main types of IRAs: traditional and Roth. Traditional IRAs offer tax breaks now, while Roth IRAs offer tax breaks later. Which one is right for you depends on your individual circumstances.
Like 401(k)s, the money you contribute to an IRA is deducted from your taxable income. However, there are some important differences between 401(k)s and IRAs. For one, you can contribute to an IRA even if you're not employed. And, there are no income limits for contributing to an IRA. This means that anyone, regardless of their income, can open an IRA account. However, you'll need to look for top gold IRA companies to find the best provider for you. Look for a company that has low fees and a good reputation.
Image/Pixabay
Your Savings Should Be Automated
One of the best things you can do when preparing for retirement is to make sure your savings are automated. This means that you should set up automatic transfers from your checking account to your retirement account every month. This way, you'll never have to worry about forgetting to make a contribution.
In addition to making sure your savings are automated, you should also make sure your debts are paid off. This includes any credit card debt, student loan debt, or other debt that you may have. Paying off your debts will help you free up more money to save for retirement.
Spend Carefully
Once you've started saving for retirement, it's important to spend carefully. This doesn't mean that you have to stop spending altogether. However, you should be mindful of your spending and make sure you're not wasting money on things you don't need.
One way to do this is to create a budget. Figure out how much money you need to spend each month on essential expenses, such as food, shelter, and transportation. Then, figure out how much money you have left over. This is the money you can use for non-essential expenses, such as entertainment and travel.
See: Having a Financial Plan Is More Important Than You Think – Here’s Why
By following these tips, you can make sure you're prepared for retirement. Start by contributing to your 401(k) or IRA. Then, make sure your savings are automated and you're spending carefully. By taking these steps, you can ensure that you'll have enough money to support yourself during retirement. What other tips do you have for preparing for retirement? We hope this article has been helpful.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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