With markets starting to look expensive it's becoming ever more important to find stocks that look a good long-term value on a risk/reward basis. In other words, if you are going to invest $10,000 right now it's a good idea to do it in businesses you will be happy to hold even if the market has a temporary correction. In this context, let's look at why Raytheon Technologies (NYSE:RTX), PTC (NASDAQ:PTC) and Deere (NYSE:DE) are attractive stocks for long-term investors.

Image source: Getty Images.

The case for buying Raytheon Technologies is based on the fact that 55% of its revenue comes from defense. So, if stocks in the defense sector are currently valued at an average of around 20 times free cash flow (FCF), then Raytheon's defense business should be worth 20 times FCF, too.

Data by YCharts

Based on chief financial officer Toby O'Brien's presentation at a recent UBS conference, the legacy Raytheon businesses (largely defense) remain on track for around $3.5 billion in FCF in 2020. However, the legacy United Technologies businesses (largely commercial aviation) are targeting breakeven in FCF for 2020.

Assuming the Raytheon businesses are worth 20 times $3.5 billion gives a value of $70 billion, and if you subtract this from the market cap of $107 billion it leaves $37 billion for the commercial aerospace businesses, Collins Aerospace and Pratt & Whitney. While that figure is not quite as attractive as it was a month ago, it still looks like a good value.

Collins Aerospace generated $4.4 billion in operating profit in 2019, and Pratt & Whitney $1.8 billion, making a combined figure of $6.2 billion. To be clear, it's going to be a long road back, with O'Brien arguing (at the UBS event) that a full recovery in the commercial aviation market wouldn't take place until 2022 at the earliest. Nevertheless, even if it takes three years to get near 2019 levels of profitability, I'd argue that $37 billion is still too low of a figure for the value of commercial aviation businesses.

The industrial software company is an exciting growth stock set to benefit from strong demand for its core products of computer aided design (CAD) software and product lifecycle management (PLM) software while there's explosive potential for its internet of things (IoT) and augmented reality (AR) solutions.

The following figures were given on a PTC presentation in April, and as you can see below, its traditional CAD revenue generated 54% of revenue in 2019 -- but that's set to fall to 35% in 2024 due to strong growth in IoT and AR.

Software Revenue

2019

Compound Annual Growth Rate 2019-2024

Target 2024

Computer aided design

$5.1 billion

8%

$7.5 billion

Internet of things

$2 billion

26%

$6.5 billion

Augmented reality

$0.5 billion

60%

$5 billion

Product lifecycle management

$1.9 billion

7%

$2.7 billion

Data source: PTC presentations.

In a nutshell, PTC is a play on the so-called fourth industrial revolution or Industry 4.0. These grandiose titles simply refer to use of IoT devices in order to create even more automated fatories. With PLM, customers can use the iterative information gathered via web enabled devices to better manage the lifecycle of a product from creation (using CAD) though to production and ultimately, disposal.

IoT will help industrial companies digitize their production by using web enabled devices to monitor, analyze, and guide their physical assets, and AR will allow this process to be carried out remotely. So for example, IoT will encourage companies to invest in robotics and automation on a production line, and AR will let a skilled engineer inspect it without being on-premise.

Image source: Getty Images.

In this context, it's not hard to see why PTC chief executive officer Jim Heppelmann said on a recent earnings call that "We expect that the new normal that follows this crisis will create stronger tailwind to the already high-growth IoT and AR markets, and will make PLM more relevant than ever."

That's good to hear. Management had to reduce its full-year guidance for average recurring revenue growth in 2020 from 12% to 15% to 9% to 12% as a result of the COVID-19 pandemic. However, Heppelmann's comments imply that the company play catch up in 2021 and get back on track for its long-term aim for $730 million to $930 million in FCF in 2024. Given that the current market cap is only $9.7 billion, anything within that range would make the stock look like a great value in the future.

The agricultural equipment maker has faced a number of hits in recent years. The collapse in key crop prices (wheat, corn, soybeans, and cotton) in 2014 hurt farmers' income, while the trade war created ongoing uncertainty around the prospects for U.S. farmers to export soybeans to China. Throw in the COVID-19 pandemic, and the list of headwinds gets even longer.

Note the drop in farmers' cash receipts from crops in 2014-2016 and the decline in Deere's income.

Data source: Deere presentations, USDA.

It's going to be a difficult year for Deere, but there's reason to believe that it's likely to prove a trough year in a multi-year recovery. There are some early indications that grain demand is up as a consequence of the phase 1 trade deal with China.

Food demand will recover with an overall economic recovery. Moreover, as the chart above shows, U.S. farm income from crops has been recovering in recent years, and according to Deere's management the aged fleet of farming equipment in the U.S. is in need of replacement. Finally, Deere has been making substantive progress with its precision agriculture solutions (smart farming).

Wall Street analysts have Deere's earnings recovering from $6.07 per share in 2020 to $8.57 in 2021, putting it on 19 times 2021 earnings. That's a decent value provided the multi-year recovery thesis holds.

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As the COVID-19 pandemic spread across California, the states public universities and colleges transitioned from bustling campuses to virtually empty ones sending their costs soaring and revenues spiraling.

University of California and California State University systems reported losses totaling more than $1.4 billion since the outbreak, mostly from the increased costs of online instruction and lost revenues from shuttered dorms, dining halls and other programs. California Community Colleges estimate they will lose $1 billion over the next year.

Gov. Gavin Newsom, faced with a $54 billion budget deficit, proposed a 10% cut in public higher education funding in his May budget proposal. The Legislature is considering a budget next week that will replace most of the higher education funds the governor cut. But the Legislatures replacement funding is contingent upon the state getting billions in federal funds to offset its COVID-19 revenue losses.

Failure to get those federal funds and any further reductions in public higher education threaten to rob a vital engine of the states economy of the fuel it needs to help California overcome the pandemics economic devastation. The states public higher education system is a key driver of the states economic success and essential to its ability to respond to COVID-19 and future pandemics, as well as other disasters.

One in every 10 employees in California is a graduate of CSU, with more than half of alumni staying in California and contributing to the states economy. UC is the states third-largest employer and is responsible for sparking statewide innovation, with an average of five inventions per day. UC is also the worlds largest public research university system, providing a health care system that is saving lives and a research enterprise that is seeking cures and a vaccine for COVID-19.

California Community Colleges educate those on the frontlines of the battle against COVID-19. They train 70% of the states nurses and 80% of Californias firefighters, law enforcement personnel and emergency medical technicians.

Before COVID-19 destroyed lives and eliminated jobs throughout the state, public higher education was just beginning to emerge from the financial tsunami of the Great Recession.

From 2008 to 2012, state investments in public higher education plummeted, leading UC and CSU to double tuition, lay off and furlough staff and defer new construction and maintenance. Californias Community Colleges also sustained $1.5 billion in funding reductions, which resulted in about 600,000 students losing access to higher education.

State leaders had sought to restore funding in recent years. But Californias per-student funding is still far behind where it was in the mid-1970s. At the same time, California is estimated to be about 1 million college graduates short of what state employers will need over the next decade if it doesnt produce more college graduates.

Now, with COVID-19 ravaging their finances, UC reports it lost $1.1 billion in March and April alone. CSU, which has lost $337 million already from COVID-19, recently announced that most of its fall semester classes will be online, meaning more losses of revenue from dorms, dining and its other enterprise programs. UCs and Community Colleges may be mostly online as well.

When California adopted the Master Plan for Education in 1960, it made a promise to make higher education accessible to all. The state is at risk of breaking that promise, if it cannot provide the revenues to make up for the devastating financial losses COVID-19 is creating in our states public higher education system. The states recovery from COVID-19s economic destruction will also be slower, and the future health of Californians will be at greater risk.

As alumni of our states public higher education system, we call on our leaders to invest in Californias future by investing in its world-class institutions of higher education. Doing so will keep public higher education accessible to Californians looking to improve their economic well-being. It will hasten our states recovery, and it will ensure we are ready to respond to future pandemics and disasters.

_____

Dick Ackerman and Mel Levine co-chair the California Coalition for Public Higher Education. Ackerman is a Republican and former California state senator and Assemblymember from Orange County, [emailprotected]. Levine is a Democrat and a former member of the U.S. Congress and state Assemblymember from Los Angeles, [emailprotected]. They wrote this commentary for CalMatters.

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Commentary: California's economic recovery depends on investing in higher ed - CALmatters

Warren Buffett, famous investor and fourth-richest person in the world, has some investing advice for you. And it doesn't involve ratios, valuations, or any nonsensical acronyms that have something to do with cash flow. Nope, Buffett's recommendation is far more straightforward: He says you should be buying index funds.

An index fund is a mutual fund or exchange-traded fund (ETF) that mimics the behavior of an underlying index. When you invest in index funds, your goal is to keep pace with the market. That's very different from the approach taken by stock pickers and active mutual fund managers -- people like Buffett himself. Stock pickers don't want to ride along with the market; they want to beat the market.

Image source: Getty Images.

The trouble is, few people can consistently pull that off. Buffett, as CEO of Berkshire Hathaway, had an amazing run of outperforming the S&P 500, but even he's been less successful recently. And according to S&P Indices Versus Active (SPIVA), 80.6% of actively managed large-cap mutual funds underperformed the S&P 500 over the past five years. In other words, beating the market is hard for anyone -- let alone the part-time investor.

As an investor, you have to choose your battles. You can try to beat the market by picking stocks or by investing in actively managed funds. Unfortunately, it's likely you or your fund manager will underperform. Alternatively, you can opt for moving with the market via index funds. Considering that the S&P 500 has shown average annual growth of 7% after inflation since its inception, riding those coattails isn't a bad deal at all.

As the first quarter of 2020 has reminded us, the long-term trends of the S&P 500 can be quite different from what's happening in the market right now. The average growth may be 7%, but in any given year, the index might be up 30%, down 30%, or somewhere in between.

When you invest in an S&P 500 index fund, you're signing up for the good and the bad. That's why it's important to invest only in funds you don't need for seven years or more. That way, you can ride out the inevitable downturns calmly, without having to liquidate at a low point.

Take a look at a handful of S&P 500 index funds and you'll quickly see that they don't track exactly with their index. There are several reasons for this. Some funds achieve index-level performance by replicating the index exactly; others use a representative sample that behaves like the index, often to keep costs low. Changes in the composition of the index also have to be replicated by the fund after the fact, which can affect performance. But the biggest drag on the fund's performance relative to the index is the fund's expense ratio.

Expense ratio is the fund's operating costs as a percentage of total assets. Since fund expenses do reduce shareholder returns, you should make a practice of choosing index funds with very low expense ratios. That essentially allows the fund to produce returns that are more in line with the underlying index. As a point of comparison, Vanguard S&P 500 ETF (NYSEMKT: VOO) has a very low expense ratio of.03%.

Buffett is a proponent of S&P 500 index funds in particular, because the portfolios are naturally diversified across 500 large, reputable companies. But holding only a single, large-cap equity fund may not match your risk tolerance or timeline. That's a problem easily solved, however. You can tailor the risk level in your portfolio by holding -- you guessed it -- other index funds. For example, you could add a bond index fund to reduce your reliance on equities or an international equity index fund to reduce your reliance on the U.S. economy.

If you do hold multiple index funds, pay attention to how the composition of your portfolio changes over time. Generally speaking, your equity funds will grow in value, while your bond funds will throw off cash, but remain fairly stable. Since equities are riskier than bonds, letting that trend go unchecked will add risk to your portfolio.

The solution is to rebalance your holdings every year. Rebalancing is the process of adjusting your portfolio composition back to where you want it to be. You'd do this by selling off some of the funds that are over-weighted and using the proceeds to buy funds that are underweighted. In practice, this usually means reducing your equity positions and increasing your bond positions.

You don't have to spend your days poring over financial ratios and earnings reports to make money in the stock market. Index fund investing is an alternative that's simple, accessible, and -- importantly -- reliable over the long term. In Buffett's own words, "I think it's the thing that makes the most sense practically all of the time, and that is to consistently buy an S&P 500low-cost index fund."

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This Is How Warren Buffett Says to Invest - The Motley Fool

Rajesh Cheruvu

Due to higher inflation, India will always have a depreciating bias against hard currencies such as the greenback. The Indian Rupee (INR) has depreciated at an average rate of around 4.5 percent per annum against the US Dollar for the last 45 years.

In addition, a risk of larger, disorderly depreciation due to geopolitical issues remains a potential drag. Consequently, the currency alone can be a strong driver for pushing offshore investments.

Secondly, with rising income levels, significant direct and/or indirect expenses incurred by an Indian is actually dollar or foreign currency denominated.

For instance, many HNIs send their children for higher studies abroad, global travel is on the rise for affluent India as is the demand for global healthcare. Investing in foreign assets generating foreign income can act as a hedge for these expenses.

Thirdly, investment markets abroad are much wider and deeper. Innovations such as EV (electric vehicles), Emerging Tech., AI (Artificial Intelligence), ML (Machine Learning), etc. are much more rapid abroad.

Governance of businesses is much more transparent and efficient in developed markets. Debt markets are tremendously vast, liquid, and not myopically focused on only the 10-year G-Sec instrument like in India.

Certain emerging markets growth can be quite eye-catching. India is not the only country with potentially higher real growth.

China, Indonesia, and a few other economies too represent niche investment opportunities. Lastly, the volatility of developed markets is markedly lesser on account of lower macro, currency and political risks.

This would help to reduce an Indian investors largely domestically titled portfolios overall beta as correlations (and volatility) resulting from the inclusion of offshore assets would go down.

Net-net, implementing a top-down approach starting with geographic exposure, then progressing sectorally and finally bottom-up-wise via individual securities would be the most pragmatic way to systematically develop a strategic asset allocation for ones offshore investments.

(The author is CIO, Validus Wealth)

Moneycontrol Ready Reckoner

Now that payment deadlines have been relaxed due to COVID-19, the Moneycontrol Ready Reckoner will help keep your date with insurance premiums, tax-saving investments and EMIs, among others.

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Time to diversify: Three reasons why investors should look at investing abroad - Moneycontrol.com

In a recent column, you mentioned carrying forward a capital loss from a previous investment. I was told you cannot do this, so would appreciate your viewpoint. I hold a power of attorney for my son, who is Australian and has worked overseas for more than 20 years for an arm of the United Nations. He has five investment properties in Melbourne and, before the outbreak of COVID-19, decided to sell three. One, held for 20 years, should make a healthy profit but the other two, held for eight and nine years, respectively, would be lucky to sell for a loss of $50,000. If one or two are sold in this financial year at a loss, could those losses be carried into a following financial year to offset the profit of number three when sold? What is the tax rate for a non-resident? F.C.

Loading

If your son generates a capital loss in 2019-20, it can be carried forward indefinitely and can offset future capital gains, but not income. A realised capital gain is taxed in the year the property is sold.

Good tax planning would therefore suggest that you either take your losses first, or sell all three in the same financial year. Note that a Capital Gains Tax event generally occurs when you exchange contracts, not when you settle.

As a non-resident, the first $87,000 of taxable income is taxed at 32.5 per cent, with no Medicare Levy, while the excess, up to $180,000, is taxed at 37 per cent, then rising to 45 per cent.

Dont tell your son that United Nations pensions are taxed in Australia. He might be disinclined to return!

I have a five-ounce gold ingot which I have had for many years, put aside for a rainy day. With the gold price quite high now, the rainy day has come, as I need some maintenance work on my house. There is a stamp on it for the Australian Bullion Company, the percentage of gold, and the weight. Can you please advise the best and safest way to sell the ingot? V.P.

ABC should buy back your gold bar. The company has offices in capital cities, excluding Adelaide. Call them on 1300 361 261.

You have done well. At the time of writing, gold in Australian dollars is up 12 per cent in 2020 and has almost doubled in the past decade, although it has been drifting down since March, as the US dollar weakens and our dollar strengthens accordingly.

If you have a question for George Cochrane, send it to Personal Investment, PO Box 3001, Tamarama, NSW, 2026. Help lines: Australian Financial Complaints Authority, 1800 931 678; Centrelink pensions 13 23 00. All letters answered.

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Beware being too heavily invested in overvalued property - Sydney Morning Herald

Innotech Profile

Date started:2013

Founder/CEO: Othman Al Mandhari

Based: Muscat, Oman

Sector: Additive manufacturing, 3D printing technologies

Size:15 full-time employees

Stage: Seed stage and seeking Series A round of financing

Investors: Oman Technology Fund from 2017 to 2019, exitedthrough an agreementwith a new investor to secure new funding that itunder negotiation right now.

When the coronavirus outbreak spread quickly from China to the rest of the world, triggering a global shortage of medical equipment and a race to secure supplies, Omani entrepreneur Othman Al Mandhari proposed a solution to the health authorities: Go local.

The 30-year-old engineer's Muscat-based start-up, Innotech, specialises in 3D printing services that produce parts for oil and gas companies, industrial businesses and research and development labs. As the Covid-19 pandemic paralysed international trade, disrupted supply chains and hit manufacturing bases globally, Innotech switched gears and began providing life-saving ventilators and masks for those on the frontline of the Covid-19 response in the sultanate.

"Before Covid-19 business was a bit slow, it was really tough, people didn't believe in the technology and we had to do many experiments to show customers," Mr Al Mandhari says. "Now, with Covid-19, people see the technology works. If you cannot import from China, you're forced to manufacture locally. If you want masks or ventilators, you have to manufacture locally and 3D printing is the best way."

For the former Schlumberger engineer, who left his job in 2016 to focus on growing his business, local manufacturing using 3D printing technology is one answer to Oman's economic diversification efforts to help reduce reliance on imports, create jobs for nationals and build new industries.

"Now people are thinking: what happens if you can't import from China? Worldwide, everyone will start to invest in manufacturing hubs," he says. "Why dont you invest in young engineers thousands are looking for jobs in Oman educate them, start to manufacture and export?"

Much like Innotech, 3D printing businesses in other parts of the world are modifying their production to meet increasing demand for medical equipment during the pandemic. For months, manufacturing companies, start-ups, research and development labs and major corporations have been busy 3D-printing face shields and ventilator parts for healthcare professionals and hospitals.

Innotech secured contracts with Oman's Ministry of Health to provide masks and ventilators when it became more difficult to import supplies from China, he says. Now it produces 300 to 400 masks daily in its workshop of 22 3D printers.

"Our 3D printers are running 24/7 ... we are working day and night to keep up with the demand," he says.

So far, Innotech has supplied more than 6,000 masks to the Ministry of Health, which in turn distributes to hospitals and has supplied 2,000 masks to the World Health Organisation in Oman, according to Mr Al Mandhari. It sells each mask for 2.5 Omani riyals (Dh23.87/$6.50), roughly the same amount as the cost of production.

"We are not looking to profit from these products. We are working to help our country in this crisis," he says.

Innotech was established in 2013 and was self-funded. In 2017, venture capital firm Oman Technology Fund invested $100,000 in its sister business, Innobox, which makes educational kits used to teach children aged eight years and older about electronics and programming.

Now Mr Al Mandhari is in talks with local venture capital firms to raise $2 million (Dh7.34m) to $3m in a Series A funding round to expand his businesses and expects the deal to close within six weeks, he says.

We are not looking to profit from these products. We are working to help our country in this crisis, Othman Al Mandhari,

founder, Innotech

The investment will fund plans for a 3D printing factory, which will allow clients from around the world to access the platform, upload a file with the technical specifications for their product, have them manufactured through Innotech's 3D printers and shipped.

The factory will span 3,000 square metres in the first stage, with plans to expand in future phases.

The current round of finance will also see Innotech fund plans for concrete 3D printing that will allow it to fabricate buildings initially two-to-three storeys before going on to larger construction projects, he says.

Mr Al Mandhari is also looking to finance the other part of the business, Innobox, which has already sold 800 units, but is embarking on a redesign of its product, to manufacture in-house and expand into the other Gulf and Middle East markets.

The engineer admits that the various branches of his start-up, from 3D printing to education, have prompted investors to see the business as "scattered". However, he insists that this diversification has been an advantage during the Covid-19 pandemic.

For example, the education part of the business stopped generating revenue during the pandemic as schools and educational centres shut down to curb the spread of the virus, which led to the switch in focus to 3D printing.

"Thanks to other services, we survived because of multiple revenue streams," he says. "The mentality of investors is starting to change and they're starting to see it as an advantage."

Getting its Series A funding to open the new factory will be "critical" for the business to focus on demand for parts from all sectors.

"Right now we see huge demand and we can't cover it because we're limited by the number and type of 3D printers," he says.

Oman, which relies on oil revenue for economic growth, is home to major international and local oil and gas companies that currently import parts for their facilities from others countries.

Innotech aims to add value by supplying the parts locally, which would cut costs and delivery times, according to Mr Al Mandhari.

"If we can do this service in Oman we can save time rather than months, it can take weeks for parts to arrive save costs, and help companies meet their quota for contracts to local firms," he says.

The company has doubled revenue between 2017-2019 but expects the coronavirus crisis to put a dent in that growth trajectory this year.

"The target for 2020 is to double revenue, but with Covid-19, our expectations are a bit lower," he says.

Growth this year will come from the 3D printing business once the investment is secured and the factory is set up.

"Now we can't target too many clients because the capacity of our printers is limited, but when we get the investment, we can target new customers," he says. "Once we have this factory up and running, we can definitely increase our revenue."

The start-up aims to hire another 12 employees once its secures new funding, as it looks to grow the current team of 15 people.

Future growth targets include expanding the 3D printing business to include metal, concrete and plastic production, he says.

"We are open to any investors from the Middle East," he says.

Q&A with Othman Al Mandhari, chief executive of Innotech

Who first invested in you?

Oman Technology Fund, a local venture capital firm, invested $100,000.

What already successful start-up do you wish you had started?

SpaceX! I am an engineer and engineers are in love with solving challenging problems and space is the most challenging problem you can imagine! I have always been inspired by anything related to space.

What is your next big dream to make happen?

Launch our factory, grow to become the world's number 1 online 3D printing platform and construct the first 3D-printed building in Oman.

What new skills have you learnt in the process of launching your start-up?

Dealing with people! Something we are really bad at, as engineers, is dealing with people because we are dealing with machines most of our time! Being an entrepreneur helped me shape my skills and learn how to deal with people, from customers and employees to family and friends.

How has the Covid-19 pandemic impacted your business?

Our 3D printing and R&D services are positively impacted because the government and the private sector could not import technology from China and other countries because of the lockdown, so we had a massive increase in R&D and 3D Printing services. In our EdTech department, we struggled in the beginning by losing many contracts, but later on we managed to shift into online learning platforms and got back to the track.

Updated: June 14, 2020 01:32 PM

Innotech Profile

Date started:2013

Founder/CEO: Othman Al Mandhari

Based: Muscat, Oman

Sector: Additive manufacturing, 3D printing technologies

Size:15 full-time employees

Stage: Seed stage and seeking Series A round of financing

Investors: Oman Technology Fund from 2017 to 2019, exitedthrough an agreementwith a new investor to secure new funding that itunder negotiation right now.

More here:
Generation Start-up: Oman's Innotech seeks $3m investment to expand 3D printing business - The National

While yields on short-term Indian government bonds are falling like there is no tomorrow, those on longer-term bonds remain sticky. This has led to a steep yield curve the sort that the country has not witnessed at least in the past two decades. A steep yield curve has implications for investors. The country has witnessed steep yield curves twice in the past, and each such occasion was followed by a stunning bull run in equities. To quote a popular saying, history does not repeat itself but it does tend to rhyme.

The first instance: Between 2003 and 2005, yields on short-term government bonds had fallen to historic lows and the yield curve was steep. The spread between short-term bond yields and long-term bond yields was close to 2 percentage points (or 200 basis points). While the three-month government bond yield was at four per cent, the 10-year G-Sec yield was at six per cent. At this point in time, investors were wary of investing in the equity markets. The Y2K bubble had burst and 9/11 had happened. Between 2000 and 2003, bonds delivered double-digit returns. Towards the end of the bond market rally, equity investors booked losses in equities and entered long-duration bond funds at high net asset values (NAVs) at a time when yields had already bottomed out. Over the next few years, it was the equity markets that delivered one of the strongest rallies ever. The Sensex went from 3,000 to 21,000 over the ensuing four years. From mid-2006 onwards, investors booked losses in bond funds (because yields had risen) and shifted large amounts of money into equities. This was a time when the IPO (initial public offer) boom was on in the markets. Come 2008 and equity markets fell off the cliff. Investors thus lost money both in bonds and in equities.

Wrong timing once again: As equities crashed in 2008, yields also declined. So, while equities delivered negative returns, longer-duration bond funds gave returns as high as 40 per cent during the second half of 2008. During this period, investors saw the value of their investments in equities decline at the same time when net asset values (NAVs) of bond funds were rising steeply. In 2009, investors moved out of equities (booking huge losses, of course) and entered long-duration bond funds, when their NAVs had already risen to high levels. By this time, yields had already crashed to levels that were even lower than in 2003. The yield on the three-month treasury bill was at three per cent while the 10-year G-Sec yield was at around 5 per cent. In other words, the difference in yield between these two bonds was two percentage points (or 200 basis points). At a time when retail investors had abandoned equities, the Sensex once again zoomed from 8,000 to 20,000 over the next two years, starting from January 2009. Small investors were bystanders in this rally as well.

Steep curve once again: Currently, the yield on shorter-term bonds is below three per cent. The slope of the yield curve is also the steepest, with the difference between the three-month treasury bill and the 10-year G-Sec being three percentage points (or 300 basis points). The yield curve was not as steep either in 2003 or 2009.

Equity markets are once again on tenterhooks due to the global pandemic. The fear that there may be a second wave of the pandemic, which may be more severe than the first, has dampened investor sentiment. But could 2020, during which we have witnessed a global pandemic, cyclones, locust attacks, earthquakes, and intensification of the trade wars turn out to be another belter of a year for equities? And will retail investors manage to participate in the rally this time?

Unclear picture: It is a tricky situation. The market is deriving its adrenaline chiefly from the injection of liquidity. The system is flushed with liquidity, as can be seen from the fact that every day more than Rs 7 lakh crore is parked in the Reserve Bank of India's reverse repo window. So, while the fundamentals are weak and should, in the normal course, cause equity markets to crash, liquidity support is very strong, due to which the equity markets are holding firm.

GDP data for FY20 was poor, as was widely anticipated. The economy may contract in FY21. This is a development that most investors will experience for perhaps the first time in their lives. The outlook remains bleak across sectors. Not a day goes by without news of some company or the other laying off employees.

In times of such economic distress, it is difficult to justify the current market valuations. But with so much liquidity sloshing around, it is unlikely that the markets will witness a sustained fall for a prolonged period of time. A steep yield curve also means that banks can borrow cheaply for the short-term and lend at higher rates for the long-term. Bank profits could rise. The S&P BSE Bankex is among the worst-performing sectoral indices over the past year.

Looking back at the markets in 2003 and 2009, index valuations were quite low just before the equity markets rallied: The Nifty PE was between 10 and 14 times on both these occasions. Retail investors were averse to equities. Neither of these two conditions prevails today. Equity markets are not trading at very low valuations, nor are retail investors fleeing from this asset class. So, empirically, the equity markets may not have bottomed out yet.

In such circumstances, instead of betting on current valuations, investors should run systematic investment plans (SIPs) so as to average out their cost of purchase. If they don't want the trouble of selecting an active fund, they should go with an index fund. Second, at a time when markets could plunge, quality stocks can provide a good hedge to ones portfolio. High-pedigree stocks tend to weather a storm relatively better. And even if they fall, these stocks tend to be picked by value seekers first. Third, if the portfolio size (including both direct equities and equity mutual funds) is bigger than Rs 25 lakh, the investor should consider hedging his portfolio.

In the case of a large and sudden fall, many retail investors tend to panic and sell their equity holdings. If your portfolio is hedged, you will not need to worry even if the market cracks. It is like having a raincoat while going out: Whether it rains or not, you are not affected.

While it is good to take precautions, we should not forget the lessons of history. Bull markets are born in the depths of pessimism. Staying invested in equities is important. Even if retail investors made mistakes in 2003 and 2009, they should get things right the third time in 2020.

First Published: Sat, June 13 2020. 22:01 IST

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Signals from the debt market: Staying invested in equities is importants - Business Standard

Wyzant

Customer success management is essentially relationship maintenance, built on the foundation that the client feels genuinely attended to at all times, especially when problems arise. But when it comes time to scale up, managing several accounts, including enterprise ones, requires more time. Hiring more customer success managersisnt always sustainable.

Thats where technologies like CRM systems and macros that prefill emails come in. Effective automation allows companies to tactfully respond to a large number of clients at once while still empowering CSMs to give greater attention to the biggest problems.

Built In spoke with tech professionals from three Chicago companies Fusion Risk Management, Aptitive and Wyzant that have seen rapid growth. Wyzant, for example, went from two founders connecting students and tutors on college campuses to 2 million users and 80,000 instructors worldwide in less than a decade. They said automated customer success is inevitable, but it cant succeed without human touch. All three respondents mentioned that customer success teams need to know how to analyze data and determine whether an issue can be solved through automation, or whether it requires personal outreach.

Fusion Risk Managements team analyzes their conversations with clients through a CRM, while Wyzant examines email language to determine whether it requires an automated response or a human one.

Tracey Rice

Senior Vice President, Customer Service

Tracey Rice, SVP of customer success at Fusion Risk Management, said automation only comes into play following conversations CSMs have with clients. At the Chicago-based provider of risk management services, reports and dashboards offer the birds-eye view that CSMs need to create high-level strategies for clients.

When it comes to scaling your customer success team, what are the most important considerations and why?

Its important that our customer success team is filled with empathetic, forward thinkers who are willing to go the extra mile for our clients. Their personalities are important. We also want a balanced client to customer success manager ratio so our CSMs can dedicate adequate time to each client in their portfolio. Were using metrics like product adoption, license utilizationand others to track their growth before and after joining the customer success program. We also lean on Fusions other departments to provide their subject matter expertise so we can focus on our roles account management, product, delivery, supportand solutions engineers which all have an impact on the success of our clients programs.

What tools or technologies do you use to make customer success more scalable?

Right now were leaning heavily on virtual events and video to connect with all our clients regularly. We rolled out a three-part recurring series of engagements to foster a network of sharing among our clients. We hold monthly webinars spotlighting our client success stories during our customer spotlight series and new ways our products can be used during our product showcases. Since we had to postpone our seasonal, in-person regional user group meetings, we launched a weekly community exchange so clients can candidly discuss the challenges, successesand questions they face day-to-day. Letting our communities learn from each other gets them excited about new ideas, and the CSMs can help the ideas come to fruition more efficiently.

Automation comes into play when we take what we learn from our conversations, input it into our CRM and let the analysis do the work from there.

How are you striking the right balance of automation and human touch?

We rely on regular conversations with our clients to ensure we have full insight into their program goals, executive priorities, challenges and opportunities. Were a data-driven organization, so automation comes into play when we take what we learn from our conversations, input it into our CRMand let the analysis do the work from there. Reports, dashboards and scorecards are generated so we can analyze the breadth of our clients programs and strategize where the biggest opportunities to help them may be.

Aptitive CEO Paul Corning said the Chicago-based data and analytics consulting firm develops customized templates and tools for individual clients based on previous successes so they can be repeated throughout the customer lifecycle. But no template will suit every client, so the templates are unique to each based on their own processes.

When it comes to scaling your customer success team, what are the most important considerations and why?

We want repeatable successes for our clients, but we have to consider what makes each client unique to achieve that. Our technology projects have to address the people and process side of every client if we want to be successful. The most important thing is to reuse designs and maximize the productivity of our consultants with templates and tools, while still customizing the people and process solution for each client.

What tools or technologies do you use to make customer success more scalable?

By leveraging our prior project successes, we can apply best practices and be more likely achieve the customer success that our clients want. We also extensively train our consultants in the latest technologies and build frameworks and templates that help our small teams be highly productive for client project work.

We hire only the brightest consultants and rely on their expertise to balance automation with high-touch people and process solutions.

How are you striking the right balance of automation and human touch?

The key for Aptitive is a focus on high productivity across a small team of experts. We strive to deliver value to our clients aggressively and let the consulting team leverage the tools and automation that best apply in each client project. We hire only the brightest consultants and rely on their expertise to balance automation with high-touch people and process solutions.

Tim Janis

Customer Support Team Manager

Wyzants customer support team manager, Tim Janis, said the Chicago-based edtech platform handles a significant number of its 2 million users issues at one time by keeping multiple modes of communication open, sometimes even bypassing personal customer support by providing self-service solutions or auto replies to common problems. This allows CSMs to personally address more sensitive issues.

When it comes to scaling your customer success team, what are the most important considerations and why?

As a web-based platform, our product is constantly evolving. So one of our biggest challenges is ensuring training materials are up to date with changes on all of Wyzants platforms. Thats why the skill we seek most in a new team member is the ability to adapt to changes on the fly and incorporate new information into their daily processes. Even after six years at Wyzant, I still learn new things about our front-end and back-end platforms. As comprehensive as our training is, there is no way to distill every single thing a new hire will encounter in their day-to-day work into the process. So along with the ability to stay current with platform changes, curiousnew team members must also be collaborative, tech savvy and creative problem-solvers.

What tools or technologies do you use to make customer success more scalable?

In order to assist as many customers as possible, we offer support through a variety of channels throughout the day. While we traditionally focused on phone and email support, it can be very difficult to assist multiple customers at once using these channels. Live chat has really helped us increase the number of customers we can service concurrently. Because we deal with a lot of similar customer interactions over time, we also use email macros to be as efficient as possible. Macros that prefill customer information and add a customizable email response really help make sure we can serve as many customers as possible while still providing a personalized touch. We have also started experimenting with automated email replies for common issues that do not require personalized assistance. By looking at the type of email a customer is replying to or the language used in their messages, we can automatically reply to provide a solution to their issue. Of course, we let the customer know that if they still have issuesthey can reply once more soa representative can assist further. Maintaining up-to-date self-service resources for customers is also extremely important for scaling services. Providing customers the answers to their most frequently asked questions before they even reach out not only improves the customers overall experiencebut also ensures our representatives are available for inquiries that require more hands-on assistance.

We take a data-driven approach to everything we do at Wyzant, including our support operations.

How are you striking the right balance of automation and human touch?

We take a data-driven approach to everything we do at Wyzant, including our support operations. All our customer interactions are tagged with metadata so we can review why the customer reached out and how we resolved their issue. This information has helped us automate support provided for issues that are always resolved the same way. Simple inquiries like account navigation and platform functionality are easily automated since the answers rarely change. More sensitive situations, such as customers' purchasesor those involving multiple users or variables, should always be handled by an actual representative. These interactions are harder to automate, and customers want to feel there is a real person there to take care of them and listen to their concerns while providing a solution tailored to their specific issue.

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How to Scale Customer Success Without Losing the Personal Touch - Built In Chicago

In a hectic world where technology is evolving at a faster rate, where artificial intelligence (AI) and robots are able to handle basic humans tasks, where conflicts and wars routinely break out, and where long-term relationships seem to be harder to maintain, emotional intelligence is more important than ever.

Emotional Intelligence (EI) or Emotional Quotient (EQ) refers to an individuals capability to understand, manage, and use their own emotions and those of the people around them in positive ways.

Emotional intelligence is the ability to distinguish between different feelings and identify and understand them to communicate effectively, empathize with others, relieve stress, conquer challenges, and defuse conflict.

American psychologist and science journalist Daniel Goleman is one of the most inventive writers on the topic of emotional intelligence. In his book Emotional Intelligence: Why it can matter more than IQ, the author argues that EI is twice as important as IQ (Intelligence Quotient).

IQ is relatively a fixed intelligence while EI includes behavioral traits that can be learned and improved for significant benefits, from personal happiness and well-being to career success, he underlines.

Goleman defines EI in five key categories:

Self-awareness: Self-evaluation, understanding your emotions, and recognizing how they affect your thoughts, behavior, and the people around you. Self-awareness helps you have a clear picture of your strengths and weaknesses and allow you to feel more confident and fulfilled.

Self-regulation: The ability to be in control of your emotions, impulses, or disruptive thoughts. People who self-regulate are flexible and adapt easily to changes and situations, and they are great at managing conflict and taking responsibility. Self-regulation can help you think before you act, allowing you to be more thoughtful without compromising your values.

Self-motivation: The ability to self-motivate, determine what motivates you, and achieve self-gratification without waiting for validation or praise from others. People who have high emotional intelligence are usually motivated and work consistently towards their goals, and are highly productive and effective in everything they do.

Empathy: The ability to recognize and identify other peoples feelings, wants, needs, and viewpoints and how to respond to them in social situations. Empathy helps you understand the emotions of others even if they are not obvious. It allows you to listen well, judge fairly, avoid stereotypes, and give constructive feedback.

Social skills: The ability to use your understanding of others emotions to build better relationships and connect with people using social skills such as listening and verbal and nonverbal communication. People that use social skills are usually friendly and easy to talk to. They are diplomatic in nature and experts at managing conflicts and helping others succeed.

The importance of emotional intelligence

The importance and benefits of emotional intelligence are immense, both professionally and personally. EI improves relationships, confidence, and communication skills to achieve academic and professional success.

Emotional intelligence is important in forming and developing peoples growth, which is why psychologists have suggested teaching EI in schools Emotionally intelligent children grow up to become emotionally intelligent adults and productive and compassionate members of society.

Some benefits of strong emotional intelligence include:

Better communication

Having high emotional intelligence improves communication, allowing you to express yourself clearly while staying calm in difficult situations. Strong communication skills will earn you respect and appreciation from others.

Being a good communicator helps you persuade and influence others, solve problems effectively, and have better and stronger relationships either in the workplace or personal life.

Good communication in a company helps maintain a peaceful work environment with energetic employees that get along with and respect one another, enabling longlasting professional success.

Teamwork

Highly intelligent people recognize their strengths and weaknesses, and they always put others into consideration, making them great communicators in a team. They are able to respect and value their coworkers input and points of view while listening in a positive way, building trust with their peers.

Having high EI also helps individuals be confident and open to share their own ideas without controlling the teams dynamic to get what they want, as they prefer to work in teams to increase creativity and promote ideas to help achieve the teams goals.

Adaptability

Emotional intelligence helps you adapt and adjust to new situations easily, even if they are difficult or unfamiliar, without feeling frustration or any other negative emotion resulting from the change.

People with high EI are open to change and can manage the stress, anxiety, and other challenges that come with it. Emotionally intelligent people make change an opportunity for success and growth while instilling trust and confidence in others by helping them through these changes, as well.

Leadership

Great leaders are emotionally intelligent people. They are considered, thoughtful, strong communicators, and respectful of others. They are able to understand their emotions and others thoughts, feelings, and actions and determine how to influence them and inspire them positively.

Having a deep understanding of your own and others emotions can help you be in control of your life and have a better connection with those around you, nurturing stronger relationships built on clear communication, trust, and a positive attitude.

Motivation

Understanding and managing your emotions can have a positive impact on your life. You will know how to deal with conflicts and difficult situations, leading to an increase in motivation and productivity.

Emotionally intelligent people believe that they are in control over their own lives. They are often optimistic, hard-working, and driven by a sense of ambition to be successful, no matter what obstacles they may face.

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The Personal and Professional Importance of Emotional Intelligence - Morocco World News

It is a DallasBasketball.com tradition to re-run the accomplished journalist Glenn Yoders 2011 Dallas Mavericks NBA title reflection on the anniversary of that incredible time. and it all brings rushing back Yoders work, at the top of his game on Dirk, at the top of his. Happy ninth anniversary. Enjoy .

With about a minute left in Game 6 of the 2011 NBA Finals, and the Dallas Mavericks having effectively deflated the Miami Heat's championship hopes, I turned wide-eyed to my group of friends and the packed Denton bar surrounding me. The words shot out loudly as the realization washed over the gathered crowd.

"Oh my God... They're going to win!" I must have yelled that 10 times, each holler louder than the last, and within 30 seconds, as Dirk Nowitzki's face showed that he was experiencing the same thought, I cried.

In adulthood, crying over sports is silly since you're not directly involved. It's like when I received over 20 congratulatory texts within minutes of the game ending nice, but I didn't do anything to earn that praise, other than devote years of hopes and cheers to a basketball franchise that happens to be in my hometown.

Millions of fans do the same in 29 other NBA cities each year, many of which never experience this wonderful pay-off. Players may say it is about the fans, and when things go right we feel rewarded for our commitment to the team (worse, on the other side of the coin, some of us feel "owed" when things don't go so well), but in a twisted way LeBron James is kind of right:

Our lives do remain the same, regardless of the outcome of a sporting event.

What made this win particularly special for Mavs fans is that it wasn't just about bragging rights or our validation for supporting the team through all these years. It was bigger than that, more intimate than your run-of-the-mill title. The feeling was personal, yet somehow not about us, the fans, at all. As a friend of mine tweeted that Sunday night, "Championships are so much better when you feel happier for the players than yourself."

But of course, this isn't about multiple players, even if this was a "win for team basketball," as Dirk put it. Yes, it's heartwarming to see a bunch of deserving ring-less veterans like Jason Kidd, Jason Terry and Shawn Marion finally reap the fruits of their labor. But even all of them know the truth. This was for Dirk. ... Chuck Cooperstein's call touches on that as The UberMan hits the Game 6 dagger ...

Obviously, far superior writers than I have already detailed how fantastic it is to witness Dirk's loyalty triumph over Miami's stir-and-serve recipe for success. It's a critical, beautiful storyline to this dream finale, but it only scratches the surface of a much deeper well of emotions. In short, Dirk loves Dallas, and Dallas loves him back.

In 2004, my second year living and working in Boston, I covered the celebration when the Red Sox won the World Series. I vividly recall sitting in a cramped apartment full of college students as the team closed out a sweep of the St. Louis Cardinals. Even in the ninth inning of Game 4, the Boston fans were convinced something was going to go awry (turns out this fear is buried inside me as well). But the jubilation that followed the Sox' victory was sweet for Bostonians for a totally different reason not better or worse than this Mavericks' win was for us. The Sox' championship was deeply personal to the fans, the culmination of 86 years of waiting and praying, parents and grandparents passing their fandom onto their kids and grandkids, and so forth. In the Mavericks' case, this title may be a pot of gold after 31 fruitless years passed down over a few generations of fans, but throughout this playoff run, I believe the vast majority of Dallas fans removed themselves from the equation. Even Mark Cuban took a backseat by going silent.

Why? It was all about how Dirk felt.

Under normal fan circumstances, we would simply be happy with a Mavericks championship. Dirk's personal success, which thankfully runs concurrently, should be secondary to us after all, he's a man most of us don't know personally. However, the script got flipped. In Dallas, seeing Dirk become a champion became Priority No. 1, while the fact that it also meant a Mavericks title became the bonus.

There's a simple explanation for this. Our feelings for Dirk, and frankly, his personal well-being, grew to be extremely personal over time. That's what happens when you watch an awkward player who looked like Bambi trying to walk on ice during his first season develop into the saving grace of your moribund franchise and then come oh-so-close to a championship in 2006. His struggles made us proud of each of his successes and appreciative of his tireless work ethic. We started taking personal offense when other fans, who clearly didn't regularly watch him play through countless sprained ankles, labeled him "soft." We vigilantly defended his honor when lazy national writers attempted to place Pau Gasol above him on the league's best European player list (that debate was settled convincingly this year, right?).

Soon, we began worrying about Dirk as if he was our own son out there on the court how is he going to feel about losing to the Warriors in the first round then quietly accepting an MVP trophy? How will he react if he believes his best friend got low-balled on a new contract, causing that friend to sign elsewhere? He never asked for this doting concern from us and he never would. But he certainly earned it.

Dirk toiled in the gym every day not to enhance his own legacy (his rebudding of endorsements makes it crystal clear he honestly doesn't care about his mainstream image), not just to know how it feels to be a champion for his own personal sake, but largely because he appreciated the rollicking support of Dallas, both the city and the organization. It's why he often said it wouldn't feel the same to win a championship elsewhere as was widely suggested by those who said he could never play the Batman on a title team, and should just become another team's Robin.

"I can't even tell you how great the city has been to me over the last 13 years. They've been by my side through ups and downs, fighting through a lot of stuff, and they always stuck with me," Nowitzki told Hannah Storm after the Game 6 close-out, sniffling through the interview. "They took me like one of theirs when I came there 13 years ago, and this is for them."

The second part of that quote is particularly significant: "Took me like one of theirs." For a 20-year-old German with spotty English playing in loud and proud Dallas, Texas, that's huge. But Dirk, don't defer credit: You earned that acceptance. Many of us have watched the Mavericks since long before Dirk knew where Dallas was on the map, but never felt the affection for a single player as we have for him. Dirk is everything you could want in a franchise player, as well as a humble spokesman for our city and team and an ambassador for the game itself. That those facts were so woefully misunderstood by the at-large NBA public for the duration of his career led to Mavericks fans embracing Dirk tighter still. He became one of us.

No wonder Mavs fans thanked him in true Texan style, putting Shiner Bock on his doorstep after the Finals. Dallas and Dirk have been inextricably linked for years, and amazingly, after all these seasons of wondering whether championship windows were cracked or closed, that union paid off. Big time. In the sweetest way possible, with all sorts of fun storylines about revenge and vindication and The Decision. But it didn't really matter who Dirk won a championship against. We just wanted him to get one for him. And if he didn't? We would have loved him just the same.

I spent a long time that Sunday night justifying those tears to my friends who snapped photos of my crumpled face. But there wasn't any need. They understand. The connection with Dirk runs deep his tears are our tears, and vice versa. He may have hidden his tears from public view when he jumped over the scorer's table as Game 6 ended, running into the locker room showers while covering his face with a towel to hide his emotion.

But I am proud of mine, silly and embarrassing as they may be. They're for Dirk. He earned them.

Glenn Yoder is a lifelong Mavs fan, a friend of DBcom and a veteran newspaper journalist. This article first ran on DBcom on Aug. 1, 2011.

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Happy 9th Mavs Champs Anniversary: Oh My God, Theyre Going To Win! - Sports Illustrated