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What to Focus on This Year



We all know that 2021 took a battering ram to certain sectors (not to mention what happened in 2020). However, financial stocks showed a strong performance in 2021 — the 33% gain in the sector made it the fourth best-performing sector in the S&P 500. In fact, the largest U.S. banks have shown strong merger and acquisition activity. In addition, trust banks, brokerage companies and others have shored up higher retail trading volume. contributor/ – MarketBeat

The Federal Reserve’s impending rate hikes and tapering of its bond-buying program this year attempt to browbeat high inflation. In general, that will make for a decidedly solid year for financials in 2022. 

Let’s go over what you can expect and some potential investments you may want to add to your portfolio.

What to Expect in the Financial Sector in 2022 

Focusing on large U.S. banks, consumer finance companies, mortgage-related businesses and securities-focused companies may be the key to 2022, particularly because the financial sector has historically been among the most sensitive to changes in interest rates. Many businesses do poorly in the wake of rising interest rates, but certain companies in the financial sector will benefit from higher interest rates. The Federal Reserve might do these companies (and you) a favor. 

Check out a quick description of how certain companies might fare this year and a few stocks and a few ETFs you might want to take a second glance at. 


Banks, which make up the bulk of the financial sector, include commercial banks, investment banks and universal banks. Bank stocks have projected to heave upward due to higher yields on loans due to the Fed’s soon-to-come policies. In a healthier economy, borrowers usually have an easier time making loan payments, which can also be a boon to bank stocks.

Comerica (NYSE: CMA)

Comerica, based in Dallas, has over $90 billion in assets and handles commercial loans and lines of credit, deposits, cash management, capital market products, international trade finance, letters of credit, foreign exchange management services and loan syndication services. It also offers fiduciary services, private banking, retirement services, investment management and advisory services, investment banking and brokerage services. 

Comerica would realize over $100 million of net interest income over the next year. If the Fed raises the federal funds rate past 1% over the next few years, profits may zip higher, boding well for adding Comerica to your portfolio.


Insurance makes up the second-largest unit of the financial sector and includes a broad sweep of different types of insurance companies: property and casual, life and health, specialty as well as insurance brokers. The Insurance Revenue Landscape report expects global insurance industry revenues to grow to $7.5 trillion by the end of 2025, which means solid upward mobility in 2022 for insurance.

Prudential Financial Inc. (NYSE: PRU)

Prudential provides financial products and services including life insurance, annuities, mutual funds and investment management to both individual and institutional customers.

Prudential’s international insurance unit differentiates it from peers, a point of interest for investors. Prudential reported $1.49 billion in non-GAAP (adjusted) during the third quarter, or $3.78 in adjusted earnings per share (EPS). Prudential showed 22.7% year-over-year growth last year.

Financial Services

Some companies aren’t considered banks or insurers and fall into the “financial services” classification instead, helping with investing and public markets services. This division should benefit from higher retail trading volumes and generally rising markets. 

Mortgage REITs

While you might relegate mortgage REITs to the real estate sector only, they also firmly belong in the financial sector because they focus on financial real estate instruments. In a rising rate environment, you may want to give mortgage REITs a second glance for their high dividend yields (despite the traditionally high management fees of REITs). 

Special Purpose Acquisition Companies (SPACs)

Special purpose acquisition companies (SPACs), also called blank-check companies, are companies with no commercial operations and which choose an alternative path to an initial public offering (IPO). They are created to raise capital through an IPO to acquire an existing company, raise money and trade on a stock exchange. 

Unfortunately, when an array of 25 companies became public as the result of combining with a SPAC, they underperformed on the S&P 500 Index by more than 50 percentage points in 2021, according to Bloomberg. 

You’ll want to be careful investing in them, though certain companies might deserve a look in 2022. You might want to consider an ETF like the Defiance Next Gen SPAC Derived ETF (NYSEARCA: SPAK), which covers pre-deal SPACs and the post-merger companies to give you access to a lot of growth potential.

Financial Technology Companies (Fintech)

Financial technology (fintech) stocks declined in 2021, a disappointment compared to the S&P’s upper-twenties percentage point rally. Financial technology is the technology and innovation that aims to compete with traditional financial methods in the delivery of financial services. However, fintech has opportunities at its disposal, what with the traditional financial services behemoths with large branches, huge staffing needs and gigantic regulatory overhead, fintech players can operate much more lightly, with fewer players needed in the game. 

Blockchain and Cryptocurrencies

Blockchain is a peer-to-peer shared, distributed ledger that helps record and track assets in a business network. Blocks record and confirm the time and sequence of transactions logged into the blockchain. Cryptocurrencies, which operate on the blockchain, have generated a lot of up-and-down buzz in 2021. Bitcoin trades for $50,000 and trended up 60% in 2021. Ethereum has gone up 400% and Dogecoin forged ahead 3,400%. If you’re not sure about investing in digital currencies, consider an ETF for ample diversification.

Amplify Transformational Data Sharing ETF (NYSEARCA: BLOK)

BLOK, managed by Toroso Investments, LLC, is an actively managed ETF invests at least 80% of its net assets in the equity securities of companies actively involved in developing blockchain technologies. Due to the potential within blockchain and  good buying opportunity.

Add Financials to Your Holdings

Rising rates tend to point to a strengthening economy and many players in the financial industry are poised to benefit. Will you benefit as well?


Seoul court rejects warrants for former Terraform Labs employees and investors over Luna collapse  • TechCrunch



A Seoul court rejected a request from prosecutors for warrants to detain eight people related to Terraform Labs, including the co-founder of Terraform Labs, Daniel Shin, early investors and former engineers.

It’s difficult to believe they would flee or destroy evidence as Shin and the seven other suspects have been cooperating with the investigation, Yonhap News said, citing the Seoul court. In addition, the suspects also need to be guaranteed their rights to defend themselves against the allegations of capital market rules, which is the core accusation of this case, according to the court, per Yonhap

The Seoul Southern District Prosecutors Office told TechCrunch that it is hard to understand that conclusion as the court knows the seriousness of the allegation and the fact that some of the suspects allegedly made money by selling Luna tokens before the collapse. And yet, the court dismissed the warrants, saying the eight people need to have rights to defend their cases against accusations.

Shin is being charged with taking illegal profits worth about $105 million by selling Luna tokens when it was near its all-time high without disclosing this move to investors. It happened before the collapse of the TerraUSD and Luna earlier this year, contravening the Capital Market Act. Prosecutors also suspect Shin used customer data from his separate fintech startup called Chai to promote Luna, violating the Electric Financial Transaction Act. The other seven people involved in Terraform were also alleged to have similar charges.

Shin has denied the claims of trading Luna at a market high and violating the customers’ data. Terraform was founded in Singapore in 2018 by Do Kwon and Shin. Shin left Terraform in March 2020 to found Chai and stepped down as CEO of Chai earlier this year.

South Korean prosecutors began the investigation after the crash of the UST-Luna token earlier this year, which wiped out $40 billion in market value. In September, South Korea issued an arrest warrant for another co-founder, Kwon, whose whereabouts are currently unknown, and requested Interpol, the international law enforcement agency, to issue a red notice for Kwon.

Terraform Labs could not be reached for comment.

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Amazon may lay off 20,000 employees, including managers: Report



Amazonmay lay off about 20,000 employees across divisions as the company reevaluates its pandemic-induced hiring spree, according to a media report.

A Computerworld report stated that the tech giant could lay off employees across the company, including distribution centre workers, technology staff, and corporate executives. Staff at all levels will likely be affected, it found.

Last month, the New York Times reported that Amazon plans to lay off approximately 10,000 people, and “the cuts will focus on Amazon’s devices organisation, including the voice-assistant Alexa, as well as at its retail division and in human resources”.

However, according to Computerworld, the layoffs could impact nearly double the number of employees– roughly 6% of the company’s corporate employees and about 1.3% of its global workforce of more than 1.5 million composed primarily of hourly workers.

YourStory could not independently verify the report.

Corporate staff have been told that employees will receive a 24-hour notice and severance pay, in accordance with their company contracts, the Computerworld report noted. “There is a sense of fear among employees in the company as the news has come out,” the report added, quoting a source who was informed directly about the layoff effort.

The layoffs would be the largest staff reduction in Amazon’s history.

“There is no specific department or location mentioned for the cuts; it is across the business. We were told this is as a result of over-hiring during the pandemic and the need for cost-cutting as the company’s financials have been on a declining trend,” the source told Computerworld.

After the New York Times report, Amazon Chief Executive Officer Andy Jassy shared some information about role eliminations in a note. Jassy confirmed that layoffs were occurring, though he did not specify the planned number of employees to be laid off.

“Our annual planning process extends into the new year, which means there will be more role reductions as leaders continue to make adjustments. Those decisions will be shared with impacted employees and organisations early in 2023,” Jassy wrote in the message, noting that Amazon had already communicated that layoffs would occur in the Devices and Books businesses, and would be extending a voluntary reduction offer for some employees in the People, Experience, and Technology (PXT) organisation. 

“We haven’t concluded yet exactly how many other roles will be impacted (we know that there will be reductions in our Stores and PXT organisations), but each leader will communicate to their respective teams when we have the details nailed down,” Jassy noted.

Meanwhile, the Computerworld report noted that employees on Amazon’s robotics team have been laid off.

Amazon’s muted third-quarter earnings as well as disappointing fourth-quarter projections led the company’s stock to plummet. Its third-quarter earnings were severely impacted by unpredictable consumer shopping habits and inflation. 

Amazon is likely to lay off several employees in India across divisions, according to media reports. Last month, Amazon confirmed that it will shut down its wholesale unit Amazon Distribution. This is the third business unit to be closed after the e-commerce giant announced the wrapping up of Amazon Academy and the food delivery business in India.

Globally, tech companies have announced layoffs as part of their cost-cutting efforts. In November, Meta CEO Mark Zuckerberg announced that the company had decided to reduce the size of its team by about 13%, cutting over 11,000 jobs. In the same month, Elon Musk reduced half of Twitter’s workforce or about 3,700 jobs at the social media firm.

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Unlock The Entrepreneurial Potential Of Your Team With Employee-Ownership



A strong team of many outperforms even the most hardworking of entrepreneurs on their own. But when hiring employees, freelancers and contractors, how do you ensure they have the same entrepreneurial skills and drive that you do as your company’s owner? Is it unrealistic to expect employees to be motivated and committed to an organisation they didn’t found?

Nicki Sprinz thinks she has cracked the code of unlocking the entrepreneurial potential of your team, and the answer lies in employee ownership. Sprinz is managing director of B-Corp certified ustwo London, a company of over 200 employees, and cofounder of Ada’s List, an 8000-strong community designed to support women working in the tech industry. ustwo has recently become employee-owned and has already seen the benefits of breaking down the distinction between owners and employees.

According to the Employee Ownership Association, this way of working can improve productivity, support more resilient regional economies and empower team members, resulting in them being far more engaged. Sprinz explained the main benefit for entrepreneurs of this model along with practical tips for managing directors and company founders to make the transition to becoming employee-owned.

Employee ownership protects the company

“Being employee-owned means existing team members, who are now partners, feel empowered as owners,” said Sprinz. She believes that this encourages everyone to put in the work to uphold a strong company culture and course-correct if they see anything awry.

Whilst this might not happen automatically, a founder can make it more likely that their team upholds the vision. Sprinz has put frameworks in place to ensure everyone has a voice. “We hold open firesides, have elected partner representatives on the board, and ensure there are regular channels of communication for all team members to be part of growing the culture and living the values,” she said.

Keeping the team on board means protecting the company. “There are no surprises about the direction we are taking with the business,” explained Sprinz. “We involve everyone in the decisions we make on our projects and ensure we are accountable, both commercially and ethically.”

Attract and retain top talent

In a competitive market, how does your company attract and retain the best talent in the world for the benefit of your clients? Employee-ownership could be the solution. Not only does it make job listings stand out, but it attracts individuals who are like-minded and think long term. They are committed to a future with whichever company they choose to join and are prepared to push themselves to make it happen.

“High quality potential recruits and employees are interested in values and purpose,” said Sprinz. “Being able to talk about employee ownership helps you stand out in a tough hiring market. We have several interview stages so a candidate can get to know us as well as we’d like to know them.”

Sprinz’ interview stages aim to weed out “cultural and value mismatches that ultimately lead to an unfulfilled team.” They ask candidates multiple questions about their values and examples of them in practice, and they encourage candidates to probe with questions about ustwo. They also “publicise the salary for all open roles and candidates have the opportunity to meet other members of the team,” she added.

Control quality

When scaling a business, ambitious entrepreneurs cannot afford to let quality slip. Growth at all costs is a false economy that ends with the business back at square one and having to work harder to undo reputational damage. “A more entrepreneurial team ensures quality stays high,” explained Sprinz. Not only do your team members care deeply about the work they do, they also know they benefit from company growth, so they are incentivised to keep raising the bar.

“If your team is invested in the long term financial success of the company, they also feel pride that their work contributes to overall success,” said Sprinz. “They respond by raising the bar on their work.” Sprinz also believes that, “Regular transparent sharing of financial results and metrics maintains dialogue on personal and company impact.”

Direct the future

An employee-owned company has options for the future. The owner might one day want to step aside or sell, and the company’s succession plan will already be in place. In the meantime, the company has hit new heights and progressed with new ideas because its foundations are solid.

Like Maslow’s Hierarchy of Needs, you cannot reach self-actualisation without warmth and shelter, and a company cannot break through ceilings with constant recruitment issues. When team members are bought into the company, they are bought into its future too, making more certain outcomes for everyone involved.

“The partner representatives on the board surface the priorities of the rest of the team and ensure the conversations of the board are directed accordingly,” explained Sprinz. “The representatives are actively part of the bigger picture and playing a huge part in shaping the company’s future.”

Unlock the entrepreneurial potential of your team by exploring employee ownership, advised Sprinz. The best people will be proud to tell their friends that they are part-owners of the place they work. They will feel valued and listened to and respond with their effort and devotion. Could employee ownership be the right step forward for you?

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