Danny Chen
The World of Profit and The World of Goods
Recently, Jim Simons passed away. His company successfully used a mathematics algorithm in his quantitative fund to create a superior simple rate of return(20%-40%/year) from derivative markets. The strategy requires high-frequency trading with an average holding period of 2 days and 10-12 leverage to maximize the small spread for trading profits. With the help of legal rules in the USA, he could reduce taxation from 39.50% to 20%, which boosted its total net return. It’s a return success; however, what net benefits do they bring to society?
For people who want to profit from taking climate action, the first thing they look at is ESG investment with ETFs or mutual funds. They believe that if they use a dollar-cost-averaging strategy that all-in ESG stock and bond portfolios, they will earn superior returns in the long run. At the same time, they prove themselves for taking climate action.
The problem here is that the investment is not revenue. If everyone does not purchase or promote these ESG-related companies, how will they break even and profit?
Relying on government procurement and regulation with philanthropy support will not yield superior investment returns even with lower loan rates from green banking policies. The market demand is from the users, so if you want to profit from the net-zero transition, be the change you want to see in the world and invite others to join the climate movement.
At Optivide, investment is a process that increases our users’ success rate in their personal and environmental goals. To unlock this potential, many things must be done before the investment stage. In traditional financial planning, there are at least 5 stages when building up personal financial security: saving, insurance, investment, taxation, and estate. Without a solid foundation of saving and insurance that embeds the sustainability impacts, the investment portfolio is not solid and has huge lifestyle risks.