THE ONLINE BANK THAT WANTS TO RESHAPE WORK AND MONEY - Kanebridge News
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THE ONLINE BANK THAT WANTS TO RESHAPE WORK AND MONEY

Shifts in benefits and investing are here to stay, says TS Anil, global chief executive of Monzo Bank.

By Chip Cutter
Tue, Jun 7, 2022 11:47amGrey Clock 5 min

If the pandemic changed the way people view their jobs, it may have also ushered in a new challenge for managers: how to keep reshaping work for years to come.

The desire for flexibility and a rethinking of workers’ relationships with their employers are likely to remain well into the future, putting pressure on employers to respond, says TS Anil, global chief executive of Monzo Bank. The online bank based in London officially launched U.S. operations earlier this year; it employs more than 2,500 people globally. Monzo doesn’t have physical banks but instead is based on a digital app that consolidates a user’s financial information and has tools like bots that can direct money into certain categories–say, saving for a future home.

Born in India, Mr. Anil has worked around the world at companies including Standard Chartered, Citigroup and Capital One. He was global head of payment products and platforms at Visa before joining Monzo in 2020.

He says he has spent much time in recent months considering where work is headed and how the financial-technology company’s own workplace policies should evolve. Monzo this year rolled out a three-month paid-sabbatical program for staffers who have been at the company four years or more. Such efforts reflect a desire to find ways to better support employees, Mr. Anil says.

The company is also aiming to stay ahead of changes in the ways consumers manage their finances while competing with its larger bank rivals. Mr. Anil spoke with The Wall Street Journal about what he’s focused on next.

The job market right now is tight–workers have more leverage, and employers have responded. Five years from now, will employees have as much power as they do today?

What has continued to change slowly over the last several years—but then Covid quite possibly accelerated—is the shift in mindset about what it means to work. People, increasingly, don’t want their jobs to just be about, “I go do this, and I get a paycheck.” People want meaning from their work, people want the ability to work in ways that work around their lives effectively. That shift creates opportunity for companies like us who are leading the way in terms of understanding what employees want and are willing to not be anchored to a historical way of doing things. So, yeah, I don’t think things go back in five years; this is an important cultural shift, and it’s a welcome cultural shift.

What are the new benefits companies will need to offer in the future to get employees to stay?

It’s hard to speculate on specific benefits. At Monzo, we’ve always been about our values. One is this idea that you help everyone belong. And it means we come up with ways that we can institutionalize policy to make everyone get that sense of what works best for them. We announced additional paid leave for colleagues of ours who suffer pregnancy loss, or who are undergoing fertility treatments.This is one of those where it feels like this should have always been offered by companies around the world.

What was it that prompted you to start offering paid sabbaticals?

We’re now going on seven years old, and building a bank—or really any kind of tech company—and scaling it is a marathon not a sprint. And we’re at the stage where enough of our employees have put in a few years of incredibly hard work. As we built it out, it felt like a good time to give people the ability to take a break, recharge, come back with even more energy to continue this marathon that we’re all excited to be on.

What has the response been like—how many people have signed up for a sabbatical?

I don’t have the numbers that add up how many we’ve already done since we’ve announced it, but lots of people have queued it up in terms of what they want to do in a few months, at the end of the year, early next year, and so on. So the response has been amazing.

When you look at banking, what’s the biggest change you expect to see in the industry in the next 10 years?

The biggest thing that I hope we see is making money work for everyone, which means really giving people the tools to make great decisions for themselves, to help them understand and make sense of their money. It’s still amazing and sad how little customers around the world are supported in all decisions related to their money. It’s such a source of anxiety for customers, that I’m hoping that, in the next decade, as an industry, we’ve solved that problem.

Is there a specific shift you foresee in how people will manage their money?

What I aspire to for us is that across all of your financial needs—whether it’s spending, paying, transacting borrowing, saving, investing—all of that happens in a single place. So as an individual trying to make sense of my money, I can see it all in one place; I can visualize it, I can analyze it.

What are the challenges you feel the company will need to overcome to fulfil this vision?

It’s important for us that we continue to evolve our culture for the scale that we’re growing into. That’s probably the single biggest one, to make sure that you preserve the best aspects of your culture—what we internally describe as the golden threads. Keep the golden threads, let go of the stuff that’s not working and keep evolving it. If you can get that right, then you can continue to scale and continue to have impact.

What will your job or industry look like in 2030?

It is making money work: taking the anxiety out of it for [customers] and replacing it with a sense of control and the sense that their money is working. It’s this idea of a single financial control centre—it’s in one place, they get in there, and they understand across the financial needs what the best choices are and they’re able to make them. The fundamental job of CEO is to enable the team to do the best work of their lives, and do it in a context of creating better and better outcomes for customers and for the company as a whole. So the fundamentals don’t change; that will remain the job of the CEO.

OK, five years from now, will people be working in offices more or less than today?

We joke inside the company that, what people talk about as the future of work, we talk about the now of work. Even before Covid-19, we were remote enabled; hybrid work was a reality for us anyway. Technology enables remoteness, but the human need for connection is just as real. The interplay between these two forces, I think, is what the future will be informed by. I’ve never thought of the future as being sort of homogenous, just like the present is not homogenous, right? Even in the same country, in the same company, people have different realities. The future will not be different.

Reprinted by permission of The Wall Street Journal, Copyright 2021 Dow Jones & Company. Inc. All Rights Reserved Worldwide. Original date of publication: May 6, 2022.



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These stocks are getting hit for a reason. Instead, focus on stocks that show ‘relative strength.’ Here’s how.

By KEN SHREVE
Wed, Jun 12, 2024 4 min

A lot of investors get stock-picking wrong before they even get started: Instead of targeting the top-performing stocks in the market, they focus on the laggards—widely known companies that look as if they are on sale after a period of stock-price weakness.

But these weak performers usually are going down for good reasons, such as for deteriorating sales and earnings, market-share losses or mutual-fund managers who are unwinding positions.

Decades of Investor’s Business Daily research shows these aren’t the stocks that tend to become stock-market leaders. The stocks that reward investors with handsome gains for months or years are more often  already  the strongest price performers, usually because of outstanding earnings and sales growth and increasing fund ownership.

Of course, many investors already chase performance and pour money into winning stocks. So how can a discerning investor find the winning stocks that have more room to run?

Enter “relative strength”—the notion that strength begets more strength. Relative strength measures stocks’ recent performance relative to the overall market. Investing in stocks with high relative strength means going with the winners, rather than picking stocks in hopes of a rebound. Why bet on a last-place team when you can wager on the leader?

One of the easiest ways to identify the strongest price performers is with IBD’s Relative Strength Rating. Ranked on a scale of 1-99, a stock with an RS rating of 99 has outperformed 99% of all stocks based on 12-month price performance.

How to use the metric

To capitalise on relative strength, an investor’s search should be focused on stocks with RS ratings of at least 80.

But beware: While the goal is to buy stocks that are performing better than the overall market, stocks with the highest RS ratings aren’t  always  the best to buy. No doubt, some stocks extend rallies for years. But others will be too far into their price run-up and ready to start a longer-term price decline.

Thus, there is a limit to chasing performance. To avoid this pitfall, investors should focus on stocks that have strong relative strength but have seen a moderate price decline and are just coming out of weeks or months of trading within a limited range. This range will vary by stock, but IBD research shows that most good trading patterns can show declines of up to one-third.

Here, a relative strength line on a chart may be helpful for confirming an RS rating’s buy signal. Offered on some stock-charting tools, including IBD’s, the line is a way to visualise relative strength by comparing a stock’s price performance relative to the movement of the S&P 500 or other benchmark.

When the line is sloping upward, it means the stock is outperforming the benchmark. When it is sloping downward, the stock is lagging behind the benchmark. One reason the RS line is helpful is that the line can rise even when a stock price is falling, meaning its value is falling at a slower pace than the benchmark.

A case study

The value of relative strength could be seen in Google parent Alphabet in January 2020, when its RS rating was 89 before it started a 10-month run when the stock rose 64%. Meta Platforms ’ RS rating was 96 before the Facebook parent hit new highs in March 2023 and ran up 65% in four months. Abercrombie & Fitch , one of 2023’s best-performing stocks, had a 94 rating before it soared 342% in nine months starting in June 2023.

Those stocks weren’t flukes. In a study of the biggest stock-market winners from the early 1950s through 2008, the average RS rating of the best performers before they began their major price runs was 87.

To see relative strength in action, consider Nvidia . The chip stock was an established leader, having shot up 365% from its October 2022 low to its high of $504.48 in late August 2023.

But then it spent the next four months rangebound—giving up some ground, then gaining some back. Through this period, shares held between $392.30 and the August peak, declining no more than 22% from top to bottom.

On Jan. 8, Nvidia broke out of its trading range to new highs. The previous session, Nvidia’s RS rating was 97. And that week, the stock’s relative strength line hit new highs. The catalyst: Investors cheered the company’s update on its latest advancements in artificial intelligence.

Nvidia then rose 16% on Feb. 22 after the company said earnings for the January-ended quarter soared 486% year over year to $5.16 a share. Revenue more than tripled to $22.1 billion. It also significantly raised its earnings and revenue guidance for the quarter that was to end in April. In all, Nvidia climbed 89% from Jan. 5 to its March 7 close.

And the stock has continued to run up, surging past $1,000 a share in late May after the company exceeded that guidance for the April-ended quarter and delivered record revenue of $26 billion and record net profit of $14.88 billion.

Ken Shreve  is a senior markets writer at Investor’s Business Daily. Follow him on X  @IBD_KShreve  for more stock-market analysis and insights, or contact him at  ken.shreve@investors.com .