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Tag: Investment Banking

Where is Nifty Heading and Where Will it Stop?

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Investors are unable to gauge the Nifty trends due to frequent market corrections in 2018 especially in the emerging Indian economy and financial markets with substantial erosion of wealth. There is no predicting where the Nifty is heading to or where it could stop.

What do market factors suggest?

In bull-markets large-caps tend to outperform over mid and small-caps. Hence since the financial year 2018, a bear and bullish market where market-breath on rallies is reduced appear to have emerged. In 2018 March the NIFTY breached the low of 9,950 and hit an all-time high of 11,760 on August 28th. Small-cap indices had lower tops as they peaked in 2018 January while a few large-cap stocks aided this high. 

Bull markets and scams are conjoint:

Often the bull markets are resultants of financial scams. 1992 April had Harshad Mehta using fraudulent means to use the banking channels to actively finance his playing the stock markets and led to the major crash of a bullish market. Ketan Parekh was instrumental in crashing the 98 to 2001 bull market with his being exposed late 2001. The crash of markets in 2008 was attributed to global factors which were also tainted and had a bull market prevailing.

In 2009 January Satyam Computers revealed Rs 14,000 crores fraudulent accounting practices by its founder. Again Punjab National Bank in January 2019 exposed the scam of Nirav Modi the diamantaire with a 260 crore scam in LOUs. This was also followed by the ILFS scam with a Rs 96,000 crore scam in defaulting dues which threatened to crash the economy itself.

Nifty will stop short of the 10,000:

Long-term data analytics of the stock market and trends show a major trend upset since 2018 September. The Nifty index appears to be headed downwards for the next couple of months and could be a result of the correction applied in 2018 January when the index stood at 11,761 points and not at the highest of 11,760 in August.

As in the parlance of Elliot Wave, the Nifty structure appears as with an expanded flat in the form of Wave B with three legs and a counter-trend rally. Nifty should rise to the top of the Wave-A followed by a rally in the ranges from 9,950 to 11,760 as in the Wave-B which will be predictably followed by Wave-C the disastrous ending. The value of the Expanded Flat is below the origin of Wave-B, and the corrections applied from the top of 11,760 are sufficient to predict a disaster in the nature of Wave-C.

9, 950 is the index value of the commencement of Wave B and hence suggest the Nifty will end at this level. Read with other corrections Nifty should pan out at 9,700. In parting, this prediction appears to be also influenced by the major event of Parliament election which could delay the movement by an additional 2 to 3 months. Do a remarkable course in data analytics course for financial analysts at Imarticus Learning to further understand financial trends.

 

Outrageously Simple Investment Banking Tips

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Investment banking is a particular division of banking which is associated with capital making for enterprises, government, and bank support in compound financial transactions. In simple words, investment banking meaning pertains to a bank helping public and private companies gather funds in both the equity as well as debt capital markets. These investment banks were actually founded to raise the required capitals and also to offer guidance on different financial strategies for corporate sectors.

However, when you venture into the field of investment banking, the scenario may demand many strategies to be put in the right place to become successful. You may have taken many investment banking courses but the real battle begins when you actually start the job. This is the time when you actually realize completely what is investment banking?

Well, here are certain tips that can assist you in succeeding in the area. These tips will make the job easier for you and will definitely give you an edge over other candidates in the field.

Be Adaptable

As per Graham Ward, who has been the former head of equities at Goldman Sachs and is now at the post of adjunct professor of leadership at INSEAD, if you are aware of the kind of personalities that major financial institutions are looking at, you can ensure a long-term investment banking career for yourself. Moreover, you need to be a team player who understands all the requisites of investment banking. In addition, you need to be flexible enough to learn to adapt to the continuous changes in investment banking scenarios.

Persistence is the Key

Just understanding what is investment banking is not enough to be successful in the field. You need to be smart, with an added edge of possessing hard determination and a clear focus. Try to compensate for the area where you lack in brains with high levels of energy. In short, you need to be enthusiastic, energetic, dogged, and persistent to be successful.

Always be aware of the competition

A successful investment banker needs to continuously think of different ways in which he can add value during his or her interactions with the clients. This implies that you need to be informed about the different aspects of investment banking even more than the so-called investment banking experts. Read everything related to your specified coverage area as well as your clients. This requires extreme discipline and you need to go through your client company’s newsletters, reports and even about their shareholders. Also, try to read between the lines and make your own assessments about the company. Moreover, it will not be a drawback if you ask questions about what you do not understand about the said client company.

Taking career risks is imperative

Investment banking career path is not always a smooth one. The investment banking avenues neither stay in one location nor in just one sector. You as an investment banker need to take up the opportunities as they appear. You need to be open-minded and flexible enough to take up new investment banking opportunities. You can enroll in investment banking courses. This will help you understand the investment banking meaning in a better sense.

Consistency is the key

The job of an investment banker is not an easy one. As you rise up in position, the pressure increases. However, your consistency will help you in remaining cool minded when you reach a top position. Moreover, consistency will assist you in handling the huge amounts of revenues that you are expected to generate every year.

 Dressing Sense Makes a Major Impact

Though this sounds a little strange, it is a fact that being dressed properly makes an impact on your clients. It is also a common fact that many clients turn down the investment bankers who were dressed shabbily. Thus, it is highly imperative to be dressed properly when you are going for a deal.

14 Common Misconceptions about Investment Banking

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Investment banking is the section of a financial institution that serves Institutions, governments, and corporations by providing capital raising and M&A services. Investment banks perform as mediators between investors and companies.

Here are top 14 common misconceptions about investment banking that you must know:

1. You should be economics or maths graduate
Everyone has a myth about investment banking that it requires a degree in economics or maths. But the fact that there is no consideration goes on subject or discipline. Rather than It’s more about seeing what they’re competent of, which is what the interview procedure is for. And they want smart people working here.
2. it’s very thing about trading
There’s a misunderstanding that investment banking is all about selling. In reality, the position of many people employing in investment banking bears little likeness to trading.
3. Less chance to enjoy outside life
You can be an investment banker and still have an incredible social experience. It will depend on you, that how you will manage your career with your other outside activities. Honestly, working in a venture bank can make it harder to do the things you appreciate outside of work than in 9 am to 5-pm employment; on the off chance that you need to go to the gym after work or get together with family and friends you may need to plan your outstanding task smartly effectively.
4. Just Oxbridge graduates can apply
Don’t think that only Oxbridge graduates can use for investment banking careers.  It is not restricted to just looking at people from Oxbridge schools, and there is no chance of leaving an outstanding candidate just because they didn’t study in a top university.
On the off chance that your scholastic and expert experience meet criteria, they will have each shot of getting through to the interview phase.
5. There is such a significant amount of finance language usage
Indeed, there is a lot of finance terms and language. You should know a portion of the conditions even before you begin your temporary job. For instance, amid a meeting, the questioner won’t clarify the back terms in his question, which is a piece of the tests on you.
6. Investment banking job hours are long
It’s the common myth that investment banking job hours are long. But Present banking hours may be better on the off chance that we compare with 20 years back.
7. The pressure level is high in the workplace
You work under huge worry in investment banking office.  But the stress comes from assignment deadlines and a blunder-free work approach. It’s a misunderstanding that you couldn’t work happily in a bank.
8. It’s difficult to make friends
It is an own choice whether to earn friendship with co-workers, just like in any other company.  Investment banking is a very aggressive environment; however, it draws people with a comparable goal, calibre, and sometimes even qualities.
9. People stick to investment banking just for CV boosting
We have seen individuals leaving a job in a few days.  Likewise, we also have been observed individuals doing this job for a long time. But it depends on their self-decision. As this job is very beneficial in all the ways, of course, there is no matter of CV boosting purpose.
10. The requirement of visa sponsorship
All the big investment banks will aid you with your work visa. Banks concern about talents – that’s the significant assets they have. Visa is not substantial that will damage your chance in common.
11. You can’t approach a senior person
Contacting an older person is a necessity in any workplace. It’s possible in also an investment banking career. Senior person will always be available for your support in investment banking.
12. It’s not a long-term career
If someone desires to chase other career options investment banking will respect that and endeavour to assist them to find a new job if they can. But also they can continue in investment banking itself. Its entirely depend on their personal choice.
13. You compete with your colleagues
The bond between team members here is very well-built; you’re all facing similar pressures as a team, so everyone here wants to thrive together and accomplish the best possible results for everybody. It’s not called competition.
14. Men entirely control investment banking
The facts demonstrate that the business has verifiably been very male-commanded. In any case, things have changed significantly in recent years, and there’s a tremendous push over the market to centre around selecting, holding and growing more women to guarantee proceeded and expanded advancement and an assorted variety of thought.

Also Read: What is Investment Banking

A Look at The Top 5 Largest M&A Deals of All Time

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Did you know that 2018 was globally the most happening year for deals in the capital markets and mergers or acquisitions in particular?
In investment banking circles, 2015 is remembered and used as a case study for two M and A deals. The deals of SABMiller PLC’s tie-up with Anheuser-Busch InBev worth 106 billion$ and the Allergan PLC tie-up with Pfizer Inc. for 160 billion$. Both deals are expected to be completed soon and are memorable because they comprise deals between rival forces merging. Both of these recently announced megadeals form giant conglomerates in their respective verticals.
Dealogic ranks M and A deals. According to their ratings, the top 5 deals of recorded times are as follows.

1. 1999 deal of Mannesmann being acquired by Vodafone AirTouch for USD 172 billion

This largest deal of all times was a cross-border, resisted hostile takeover. At that time Mannesmann was Germany’s number one wireless carrier and Vodaphone likewise Britain’s biggest wireless carrier. It was still the time of voice-only fixed lines and the sale of voice-only mobiles was not only popular but booming as well. Smartphones were in their infancy and Germany was definitely not a hostile takeover capital market.
Fighting the rivals for three months, Mannesmann tried for a merger deal with the French company Vivendi. Vodaphone struck back by forging a sweet deal with the French company. Once the writing was on the wall Mannesmann gave up as even the shareholders were in favor of the Vodaphone offer for a merger. Thus was born the world’s largest deal in investment banking and the biggest conglomerate mobile phone service provider.

2. 2015 deal of Allergan and Pfizer merger worth USD 160 billion

This deal is a unique case study where Allergan and Pfizer set about creating the planet’s biggest company in pharmaceuticals with Pfizer’s Celebrex and Viagra on the same selling platform as  Allergan’s Botox. The Pfizer move for inversion meant lowering of taxes as the US company could use the technique of inversion to claim incorporation in foreign countries with lower tax-rates while merging with Allegran who are Dublin-based. The US government termed unpatriotic such inversion moves and passed a bill to restrict such moves. However, the Allergan-Pfizer union could sidestep the rules since the acquiring company was indeed a foreign company.

3. 2013 deal of Verizon Wireless merging with Verizon Communication in a merger worth USD 130 billion

Vodafone was not the buyer but seller in this deal. Verizon Communications the U.S.-based giant in the telecom field bet big on broadband and cellphone services to buy the 45 percent stake it did not own from its JV partner Vodaphone, in a deal worth 130 billion$. Dealogic also ranks this the largest corporate bond issue in investment banking, because financing was through 49 billion $ in bonds by Verizon making Verizon Wireless today’s largest carrier with more than 137.5 million global customers for its wireless services.

4. 2015 deal of SABMiller acquisition by Anheuser-Busch InBev for USD 117 billion

The 117 billion$ worth merger of the two brewery giants created a giant union selling a close 33% of the global beer sales. Anheuser-Busch the Belgium-based renowned brewer found a willing sales merger partner in buying SABMiller who are U.K.-based brewers. SABMiller bargained its way to a great deal almost 50 percent higher than its closing price just a day before announcing the deal. This merger has stellar brands like Budweiser, Pilsner Urquell and Stella Artois from a 64 billion $ worth titan brewery today. The anti-trust approvals are still pending in many countries and when the deal fails, SABMiller will still receive the breakup fee of 3billion$.

5. 2003 deal of Time Warner’s acquisition by America Online in a marriage of sorts worth USD 112 billion

According to Bloomberg America Online’s purchase of Time Warner worth 112 billion$ could be famous as the 5th largest deal in history, and infamous as the worst corporate marriages in M and A global history. What was being touted as a synergetic marriage of new and old media giants, with Time Warner being the largest entertainment company and AOL being the pioneer of bringing internet to its customers, was doomed to a disastrous start. In just a few months the economy slumped with the bursting of .com bubble. The two companies were culturally too different to establish the promised progressive initiatives. Later that year AOL had accumulated losses of 99 billion $ which grew to 100 million$ plus in the next few years. The initial losses included charges that were reported at declining share values of AOL and in 2009 AOL was spun off by Time Warner amid huge shareholder losses.
Concluding notes:
An important investor lesson learned was that the mergers do not always yield benefits promised. Do an Investment Banking Course with Imarticus Learning to learn the nitty-gritty of M and A deals and exercise caution as a shareholder investor. All the best with M and A deals and your investment banking course!

The Evolution of Corporate Strategy From Budgeting in The 1950’s

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Learning all about how strategy in corporate is impacted by the budget vision, balance scorecards, goal weights, and such actions, is critical to succeeding in a highly competitive corporate environment. Such learnings should be explored about modern corporate ecosystems and are best achieved in the classroom mode of learning.
There are a number of factors that affect corporate strategy. In this article, we shall discuss the bare essentials of vision, budgets, the BSC and goal weights and how they impact competitive strategy.
Corporate Vision: 
Most corporate strategies do have a vision. Look at the functioning of Southwest Airline’s Herb Kelleher who had the foresight to bring flight prices on par with road travel. Working on his intuition and corporate strategy, the airlines evolved as the leading low-cost carrier. However, blinding vision can also overlook realities in the market place. Like the Enron case study where Jeffrey Skilling’s vision was to make it unstoppable because of its quantitative processes and securitization.
However, the concept was blinded to endemic problems and led to a significant financial drain. Similar to this was the idea of Jack Welch in corporate strategy that every business should either be number one or two in its category or be disbanded. The vision had a short life and was found faulty as success evaluation was very different from slotted classes.
Corporate strategy has evolved since the 1950s:
Great strategists in Indian history, since the first budget in the 1950s, were those leaders who personified the timeless corporate principles and could gauge the game a few moves ahead of the others. To them, there is no winning. Rather it is about finding newer challenges, gaining better skill sets and the resources to handle them all. In corporate strategy and especially in India, the corporate strategy since independence has been closely linked to the budget and its vision.

Competitive corporate strategy and Goal-weights:

Citing from a 2002- book by Professors Gary Latham and Edwin Locke who wrote extensively on corporate goal-setting based on their combined 70years of experience, competitive strategy goals should be defined as below.

  • Better performance comes from setting challenging goals.
  • More significant effort is generated from higher goals.
  • Rapid work is possible with tighter deadlines.
  • Personal commitments made public enhances the probability of succeeding.
  • Goal achievement is not impacted by who and how the goals are set.

Though this strategy seems simple and perfect many organizations follow policies that are in total opposition. Like strategies that indicate goals relatively as in cascading goals, the SMART goals and using percentage goal weights.
A SMART goal is ‘Specific’ and ‘Measurable’ while being ‘Attainable’ to the doer, ‘Realistic’ in quantitative terms and ‘Time-bound’ with specific deadlines. This method shows results when looking if goals are set and are specifically well-stated.
Cascading goals from the top downwards should never be limiting and rigid. They need to be in line with the goals of the executive team and individual goal setting.
The use of goal weights often proves counter-productive when one uses percentages. Instead, the best way is to indicate low, medium and high goals as the priority base.
Having looked at the various methods involved in goal-setting let us reiterate that while goal setting is of prime importance, there is no one way or technique to achieve goal success. Research by Latham and Locke point out that investing thought, effort and time into goal setting does payoff. One needs to be cautious with cascading management goals, avoid numerical and percentage weights and not blindly following the SMART test.

The Balanced Scorecard:

The BSC helps manage and implement corporate strategy within a time framework.  The BSC is a useful tool which links strategic objectives to the vision, measures initiatives, and targets, and balances financial measures with KPI indices. It applies across the organization and improves business performance. The technique was first advocated by Dr. David Norton and Dr. Robert Kaplan in the early 1990s and is accepted as being the theory.
Conclusion:
Concepts like the balanced scorecard, cascading goals, SMART goals and using percentage goal weights in goal setting are an integral part of corporate strategy. If this field interests you Imarticus Learning has some excellent courses in corporate strategy.
At Imarticus, it is essential to learn the best positive approach and test all theories. The assignments, case studies, and project portfolio are all practically oriented. The Investment Banking Courses also have modules in honing soft-skills and personality development coupled with assured placements and a well-accepted certification. So why wait any longer? Join today!

Deutsche Bank Loses $1.6 Billion on Bonds

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Deutsche Bank is amidst the world’s top 50 financial institutions with its investments in BNP Paribas, Allianz, AXA, China Construction Bank and Berkshire Hathaway.  The loss faced by Deutsche Bank in its complex municipal bond investment which amounts to $1.6 Billion is one of the historical losses in the banking industry to date. Embattled banking institute Deutsche bank had to face a rough path in its investment on bonds of insurance of Warren Buffet’s Berkshire Hathaway.  

The story started in 2017 as a giant investment deal

These losses are a result of $7.8 Billion municipal bonds bought back in 2007 by the leading global investment German Deutsche Bank. According to The Wall Street Journal, the German lender had bought default protection on the bonds which led to paying $140 Million in the following year for a transaction. This scandal about Deutsche Bank hogged the limelight after The Wall Street Journal came up with this breaking news. It is to be noted that the German lender had previously refused to accept the depreciating rates of these bonds for years which the markets had suggested brushing aside the concerns of financial agents. 

Arising conflicts within the German bank executives

Though it has been a decade after a disastrous investment like this, the Deutsche Bank has not come out clean with regard to its scope of loses on the municipal bonds. The piling of the loss may probably be due to the negligence of the Deutsche bank in recognizing the loses earlier and the conflicts between the executives of the bank regarding the decision to invest in Berkshire Hathaway.

Financial auditors had raised doubt regarding the capabilities of the Deutsche bank to withstand the future loses due to such municipal bond investments earlier. However, the German lender had ignored such concerns about those related derivatives. Finally, after almost a decade the Deutsche Bank decided to offload these municipal bonds. Since the senior executives refuse to restate the happenings regarding the bonds the internal investigations had come to a halt. 

Ultimately Deutsche bank had decided to sell the municipal bonds for Berkshire insurance for a loss of $1.6 Billion in 2016. The debate among bank executives included whether they should have explained clearly about the wrong-path in this investment. But, later chose not to restate it.

This story has not come to an end

The Deutsche Bank spokesperson explained that this investment was unwinded in 2016 as part of winding up non-core operations. After the interrogation of auditors and external lawyers about the municipal bonds, it was clear that it accounted in line with the rules and regulations. However other journals predict that this deal may have to face interrogations from the investors and the people concerned and that the Deutsche Bank can expect another storm any time soon. Deutsche Bank is also in the news for rumours about its Russian money laundering. The bad decision behind the investment led to the Deutsche Bank dragging the decision to finally sell it off at huge losses. 

What Is In The Store For The Indian Markets in 2019?

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In 2019, the current Prime Minister of India, Mr Narendra Modi is scheduled to submit his application and woo a billion individuals of India for a second run as the ruling government. While pole predictions are on the way and experts predict that Modi will undoubtedly succeed in his attempt, there is another major event in global history which is scheduled to happen.

In Mid 2018, the World Bank is set to release a global list of nations GDP from across the world. While this seems uninteresting at first sight, experts predict that India is set to overcome and become the 5th largest nation in the world surpassing the UK.

While this might seem to be a rare coincidence, we can confidently say that political parties will not let go of this opportunity to show off their might and skills. But since the results are yet to be announced, experts are predicting the outcome based on previous data.

According to the latest estimates by the World Bank, the GDP or Gross Domestic Product of India was 15 billion USD bigger than the French economy in 2017. As of now, India is only behind, United States of America (USA), China, Japan, Germany and United Kingdom (UK) in terms of its economy, but this year this might change for the better.

While both China and the USA are multi-trillion dollar economies, the India of today is only a 2.6 trillion USD economy. Right after the recession and depression of 2010 to 2017, the UK has only seen a 2 per cent growth in its economy, while India has seen a staggering 7.5 per cent. If the economy of India continues to grow at the same rate even this year, the predictions will come true, and India will surpass UK in its overall GDP.

Although the ruling party might contest a narrative around this news, but the fact still remains that the living standards of the UK are too high for the average Indian to catch. As of 2017, the average income of a UK resident was $42,515 whereas that of her Indian counterparts was only $1,964.

While India may surely surpass the UK in the race for becoming the 5th largest economy in the world, it will take her some years to overtake that of Germany. As of now, Germany is the fourth largest economy in the world, with the World Bank pegging her at 4.7 trillion US Dollars.

Another announcement that is scheduled to take place is that of India becoming the fastest growing economy in the world this year. With a projected growth of more than 7.3 per cent over the past couple of years and a GDP growth of 7.6 per cent in the first quarter of 2018 to 2019.

As per the statistics available with the Central Statistics Office(CSO), the average per capita of Indians have increased from Rs. 86,647/- in 2014-15 to Rs 112,835/- in 2017-18, recording a 30.2 percent growth from 2014-15 to 2017-18.

With all this being said, we can confidently predict that this will be a year of growth for India as a country of billions.

How investment banks operate in DCM markets?

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How investment banks operate in DCM markets?

DCM or Debt Capital Markets is the link that connects the corporate issuers and bankers. DCM groups provide advisory services to corporate issuers for debt-raising required for acquisitions, restructuring of debts existing-debt refinancing, and old-debt refinancing. The investment banker is the vital link in the entire process and acts as a broker between the intermediaries. Such investment banking teams need to be agile, flexible and abreast a fluctuating market.

One will need proficiency in markets with fixed income, treasuries, bonds, instruments in the money market, and much more. The investment banker receives a fee from the contracting parties for his mediation and making of financial arrangements, advice on financial issues like mergers, acquisitions, and services in trading of bonds, shares etc.

Let us understand the Debt Capital Market operations to explore the role of the investment banker in DCM operations.

DCM Teams and ECM Teams
DCM teams focus on operating the fast-paced short-term side of financial investments. ECM-Equity Capital Markets teams focus on the long-term investments which move slower. The risk factors keep these two teams in different environs. Obviously, the ECM teams bear more risk with longer termed investments. DCM teams work with debt securities and ECM teams with equity securities. The differences between the teams are due to the risk capabilities and types of investments they focus on.

Debt Capital Markets explained.
DCM or Debt capital markets are capital markets that generate fixed-income and have low-risk. The investors receive debt securities for money lent to the company invested in. The DCM is popular with companies who look for finance through debt. Investors also prefer them as it ensures their capital remains intact while they earn profits and a fixed-income.

Investors are comfortable with low-risk income providing instruments in the DCM like bonds, debt securities, and others. This helps them preserve the capital amount while earning profits when trading in the securities. The investment bankers advice customers for a fee on the risks involved in investing in such money investments.

Debt Securities:
Companies that raise funds make debt securities to the lenders in the form of money market instruments, bonds, treasuries and such. The creditworthiness of the debtor is assessed and sets the interest rate. Higher the creditworthiness lower will be the interest rates.

Debt securities can be obtained from both the primary and secondary markets. The primary market is one where companies issue their bonds. The secondary market is one where persons holding bonds sell them at market prices which may be higher or lower.

Bonds:
 Bonds are securities dealt in by the DCM teams. They have different values, characteristics and return profiles. The most often mentioned bonds are: 

  1. Investment bonds
  2. Bonds with high-yield
  3. Bonds from the government
  4. Emerging markets based bonds
  5. Bonds by the municipality

    Learn all about the DCM team, investment banking roles, and job opportunities, payouts expected and more by doing investment banking courses in India. These courses offer a good grasp of fundamentals, concepts, theoretical knowledge, practical skills and certifications that could help enhance your resume and career. They also offer boot camps, short term workshops, and basic knowledge of technical skills in Java, Python etc.

    For investment bankers. While certification definitely helps, you need to be an excellent communicator and work diligently to acquire the best analytical, technical and business skills crucial to your job role. Another advantage in such courses is of mentoring by certified and experienced industry aces that helps garner the latest best practices, techniques, skills, and practice on the latest trending technologies in the field of investment banking, financial courses and more.

The Change In Financial Ideals in 2018

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The year 2018 has been one of consistent evolution and change. One part of society that has been impacted heavily due to the shift in ideals is the financial sectors. Investors in this year shifted their methods and strategies in an environment where uncertain financial policies impacted trade universally. This shift in financial ideals caused a shift in market behaviour leaving a lasting impact on universal technological development. 2018 was a year that brought together key elements of technological advancement that heavily impacted market behaviour and investor trends.

Technological Investor Priority

One of the largest beneficiaries in 2018 were tech industries. In a year that saw an overhaul of investor sentiment, technology remained a steady progressor in investor faith, this is due to the visible improvement in the operations of these industries across the market. This year saw more investment towards technological development with large capital raised by companies specialising in AI, Blockchain, and non-banking financial infrastructures like Venmo. On the flipside, investor faith snowballed in non-regulated financial infrastructures that were impacted by government oversight and policy, the biggest example of this is the fall of the cryptocurrency market. The change in ideals for investors culminated in the year 2018 being the first in history where traditional powerhouse markets like gems and jewellery, oil and pharmaceuticals raising less capital investments than technology and development. 

The Shift In Investor Education

2018 was the year of the educated investor, financial ideals in the past year were highly focused on regulation policies by worldwide markets, investors became more cautious in investing large amounts in dwindling markets with unstable market forces, the largest drop-off in investor faith was experienced in American markets with unstable policy regulations creating an environment of uncertainty across industries. Few investors relied on sentiment-based investment, and traditional market faith dwindled heavily. The focus shifted to conservative investment banking courses strategies in most industries, the exception being medical technology, AI and security.

What Are The Concerns?

The past year also was a year of deep introspection by markets on core issues of technology development, with Facebook, Google and Uber being questioned by governments and users alike on user-privacy, applicational integrity and social impact issues like cyberbullying, crypto safety and data regulation. This created an uncertain environment that led to investors questioning the ethics of technological development, the investor behaviour reflected resistance to social media investments due to lack of oversight and concerns of leadership overhauls. Another aspect of technological development that impacted investor sentiment and behaviour is the use of technology without oversight, the need for government regulation or the reluctance to accountability to ethical and sustainable development.

In conclusion, 2018 was a year of shifts in financial ideals, the year shifted the thought of investors in the short and long term and focused heavily on regulated tech infrastructure while also showing caution amongst investor faith in traditional markets. This created a new dynamic for both technological evolutions while creating questions about checks and balances to sustain the development in ethical means. The trend of technology investments focused on medicine, AI and cybersecurity seem on the up in the year 2019 as well, but other networks like social media and crypto-currencies seem to lack investor faith.

Major Financial Upsets 2018

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2018 was definitely a landmark year when it comes to financial events. There were a number of events which shook the nation at the time, and importance of these cannot be understated. Let us take a look at some of the biggest events this year, which has the potential to affect the landscape over the long term.

Recap Bonds

The government went through with the plan it had conceived in October 2017 and issued recap bonds worth Rs. 88000 crore at the start of 2018. This was the first instalment in a total of Rs. 2.11 lakh crore and the government said that it would move towards bank capitalisation by infusing at least Rs. 1.06 lakh crore in issue bonds.

PNB Scam

By far the biggest scandal to rock the financial landscape this year, the first quarter was rocked by the allegations regarding a massive fraud regarding Nirav Modi and the Punjab National Bank. The size of the scam was alleged to be more than 14000 crores, and this meant that the bank had to request the RBI to spread the scam out over 4 quarters, unlike the usual procedure.

FPI Debt Investments

One of the many bold decisions which the RBI took this year, this one saw the RBI lowering the mandatory holding period by foreign investors of government debt securities in the nation from the previous tenure of three years to one, and this happened in April.

Loan Waivers

There was a huge number of loan waivers this year, with a huge amount of existing farming loans in states being waived off by the banks. It is to be noted that seven out of the nine states where this occurred were scheduled to undergo elections this year. The total loan amount waived off by the banks amounted to Rs. 1.72 lakh crore.

IL&FS

IL&FS was the largest infrastructure company in the nation, and in 2018, it defaulted on a debt of Rs. 91000 crore it had racked up. This had a huge impact on the balance sheets of many companies which worked with this organisation, and there was a massive tremor felt across the financial landscape in the nation. Even DSP Mutual Fund wrote down the investments it had in IL&FS to zero after this news was announced by the organisation.

Bank Mergers

This was a year of Bank mergers, and many banks like Dena Bank, Vijaya Bank and the Bank of Baroda underwent mergers. LIC also increased the share it has in IDBI Bank from 11% to 51%.

Resignation

After a long period of tussling with the central government regarding the higher dividends and allowing eh banks to lend more, RBI Governor Urjit Patel finally resigned from his position citing personal reasons. After a brief interim period, Shantikanta Das was appointed as the Governor of the Reserve Bank of India.

These are only a few of the many financial upsets which took place this year. We must wait to see what 2019 has in store for us, and hope that it is not as shocking a year as 2018 was.