Some number highlights copied from the Forbes article below:

The past year Sequoia’s scrappy methods have produced the firm’s biggest gains ever. A record nine Sequoia partners appear on the FORBES Midas List of the most successful venture capitalists, thanks to the firm’s lucrative investment in companies such as Airbnb, Dropbox, FireEye, Palo Alto Networks, Stripe, Square and WhatsApp. At the No. 1 spot is Sequoia partner Jim Goetz, who backed WhatsApp in 2011, well before Facebook agreed to buy the mobile-messaging company for $19 billion. Leone ranks No. 6, followed by colleagues Michael Moritz, Alfred Lin, Roelof Botha, Neil Shen, Michael Goguen, Bryan Schreier and Kui Zhou.

Consider Sequoia Venture XI Fund, which in 2003 raised $387 million from about 40 limited partners, chiefly universities and foundations. Eleven years later Venture XI has booked $3.6 billion in gains, or 41% a year, net of fees. Sequoia’s partners stand to collect 30%, or $1.1 billion, while limited partners get 70%, or another $2.5 billion. Look for even more outsize returns from Venture XIII (2010), which is up 88% a year so far, and Venture XIV (2012). The latter two will split the $3 billion or so Sequoia takes home from the WhatsApp deal. Add it up and Sequoia is turning its own partners into billionaires while keeping outside investors purring.

http://www.forbes.com/sites/georgeanders/2014/03/26/inside-sequoia-capital-silicon-valleys-innovation-factory/

(Source: Forbes)

Buyout firm Apax Partners LLP stands to score a 10,000 percent gain on its 2005 investment in King Digital Entertainment Plc (KING) as the maker of smartphone game “Candy Crush Saga” prepares its initial public offering.

In one of its last venture capital deals before it abandoned that business, London-based Apax injected about $35 million into King, according to a person with knowledge of the deal, who asked not to be named because the terms are private. The games maker set terms last week for the IPO that would value it at as much as $7.6 billion. Apax’s stake could be worth $3.5 billion.

While Dublin-based King has developed more than 180 games in the past decade, “Candy Crush,” a puzzle game that features colored candies, fueled most of its growth. The potential windfall comes as venture capitalists are seeing their best returns since the late 1990s dot-com bubble. Twelve venture-backed companies went public in the U.S. last year with market capitalizations above $1 billion at the time of offering.

(Source: Bloomberg)

Total U.S. crude oil production averaged 7.5 million bbl/d in 2013, 967,000 barrels per day (bbl/d) higher than 2012 and the highest level of U.S. production since 1989. In December 2013, U.S. crude oil production reached 7.9 million barrels per day (bbl/d), according to EIA’s recently released December 2013 Petroleum Supply Monthly, an increase of 785,000 bbl/d (11%) compared with December 2012.

(Source: EIA)

High-frequency trading (HFT) is a type of algorithmic trading, specifically the use of sophisticated technological tools and computer algorithms to rapidly trade securities. HFT uses proprietary trading strategies carried out by computers to move in and out of positions in seconds or fractions of a second. Firms focused on HFT rely on advanced computer systems, the processing speed of their trades and their access to the market.

As of 2009, studies suggested HFT firms accounted for 60-73% of all US equity trading volume, with that number falling to approximately 50% in 2012.

High-frequency traders, move in and out of short-term positions aiming to capture sometimes just a fraction of a cent in profit on every trade. HFT firms do not employ significant leverage, accumulate positions or hold their portfolios overnight; they typically compete against other HFTs, rather than long-term investors. As a result, HFT has a potential Sharpe ratio (a measure of risk and reward) thousands of times higher than traditional buy-and-hold strategies.

HFT may cause new types of serious risks to the financial system. Algorithmic and HFT were both found to have contributed to volatility in the May 6, 2010 Flash Crash, when high-frequency liquidity providers rapidly withdrew from the market. Several European countries have proposed curtailing or banning HFT due to concerns about volatility. Other complaints against HFT include the argument that some HFT firms scrape profits from investors when index funds rebalance their portfolios.

History

Profiting from speed advantages in the market is as old as trading itself. In the 17th century, the Rothschilds were able to arbitrage prices of the same security across country borders by using carrier pigeons to relay information before their competitors. HFT modernizes this concept using the latest communications technology.

High-frequency trading has taken place at least since 1999, after the U.S. Securities and Exchange Commission (SEC) authorized electronic exchanges in 1998. At the turn of the 21st century, HFT trades had an execution time of several seconds, whereas by 2010 this had decreased to milli- and even microseconds. Until recently, high-frequency trading was a little-known topic outside the financial sector, with an article published by the New York Times in July 2009 being one of the first to bring the subject to the public’s attention. On September 2, 2013, Italy became the world’s first country to introduce a tax specifically targeted at HFT, charging a levy of 0.002% on equity transactions lasting less than 0.5 seconds.

In the United States, high-frequency trading firms represent 2% of the approximately 20,000 firms operating today, but account for 73% of all equity orders volume.

As HFT strategies become more widely used, it can be more difficult to deploy them profitably. According to an estimate from Frederi Viens of Purdue University, profits from HFT in the U.S. has been declining from an estimated peak of $5bn in 2009, to about $1.25bn in 2012.
Vincent “Vinnie” Viola, the founder of Virtu Financial Inc, is High Frequency Trading’s (HFT) first billionaire. He has an impressive track record of just “one losing trading day” during a 1,238 trading-day period.

How does he do it? The same way other High-Frequency Traders do it: front running trades and scalping countless billions and billions of fractions-of-pennies in the process.

High-frequency trading could soon officially mint its first billionaire.

Vincent “Vinnie” Viola, the founder of Virtu Financial Inc., could have his stake valued at around $2 billion once the company sells shares to the public, according to two people familiar with the matter.

In a filing Monday, Virtu said it hoped to raise $100 million in an initial public offering, though that figure is just a placeholder that could change based on investor demand. The company will likely seek to raise between $200 million and $250 million, according to the people. At the high end of that range, Virtu would be valued at about $3 billion.

Mr. Viola owns almost 70% of the company. Virtu is hoping that its stellar record – having just “one losing trading day” during a 1,238 trading-day period concluding at the end of December – will grab the interest of investors despite growing scrutiny of the high-frequency trading industry.

Virtu said in its prospectus that the U.S. Commodity Futures Trading Commission was “looking into our trading during the period from July 2011 to November 2013.”

The CFTC is examining Virtu’s “participation in certain incentive programs offered by exchanges or venues during that time period.” Virtu said it didn’t believe it violated any statute or regulatory provision.

The Securities and Exchange Commission has also said it is looking into the impact of high-frequency traders on market stability and fairness.

In addition, a French regulator, Autorité des Marchés Financiers, is examining the 2009 trading activities of a company that eventually became part of Virtu, the prospectus said.

Virtu declined to comment on the regulatory inquiries.

Mr. Viola gained attention last year after paying $240 million for control the Florida Panthers of the National Hockey League. He put his Manhattan mansion on the market for $114 million in December.

(Sources: Various, Wall Street Journal, New York Times)

• Deductions
• Diversions
• Deferrals
• Deflections
• Diminution

To budget accordingly, you must know which ones have far-reaching ramifications.

The expiration of the Federal tax provisions will almost certainly have an adverse impact on a wide swath of taxpayers; increasing the effective tax rate of both large and small businesses, with additional collateral damage to individuals and charitable organizations. Notable expired provisions include higher Section 179 limits, bonus depreciation, energy tax incentives, the R&D credit, and many others.

At the time of this writing, the prospect for retroactive extension of these provisions is unclear at best. Sen. Harry Reid introduced an extender bill (S. 1859) in December that failed to pass by unanimous consent. The Senate Finance Committee is working on another extender bill, but members of both parties have expressed their preference for comprehensive tax reform in favor of tax extender legislation. Whether or not such legislation will be enacted prior to the upcoming mid-term election is anyone’s guess, but by historical standards prospects for near-term, comprehensive tax reform are dim.

Access this comprehensive list now to find out which Expiring Federal Tax Provisions (2013-2023) impact you »

Capitalization rates, used by real-estate investors to measure the annual return of income-producing properties, declined for many property types in 2013, according to data from Real Capital Analytics in New York. Meanwhile, the spread between cap rates and yields on 10-year Treasury notes narrowed. The average cap rate for all property types was 6.74% last year, down from 6.76% in 2012. Cap rates fell fastest for office buildings, which had an average cap rate of 6.93% in 2013 compared with 7.15% in 2012.

(Source: Wall Street Journal)

China’s imports rose the most in five months in December, indicating that domestic demand will support economic growth, as the government claimed the title of the world’s biggest trader of goods.

Inbound shipments advanced 8.3 percent from a year earlier, the customs administration said today in Beijing. Exports rose 4.3 percent, a pace that may be distorted by fake invoices. The trade surplus was $25.6 billion.

Improving demand will help support expansion amid risks from rising domestic debt and the impact of President Xi Jinping’s broadest policy reforms since the 1990s. While China said today it passed the U.S. to become the top trading nation in 2013, the government highlighted challenges for exporters including gains in the yuan and increased labor costs.

China already ranked No. 1 in goods exports in 2012 and was the second-biggest importer behind the U.S., according to the World Trade Organization’s annual report on international trade statistics. With $2.08 trillion in inbound shipments through November, the U.S. was poised to remain the world’s biggest importer in 2013.

China was fifth in exports of commercial services in 2012, behind the U.S., U.K., Germany andFrance, the WTO said. China was No. 3 in imports of services, behind the U.S. and Germany.

In economic size, China remains second to the U.S., with gross domestic product of about $8.2 trillion last year, about half that of the U.S.

The yuan rose 2.9 percent against the dollar last year, the most of 11 Asian currencies tracked by Bloomberg. It touched 6.050 earlier today, matching the level reached on Jan. 2, which was the strongest since the government unified the market and official exchange rates at the end of 1993.

The economy may have expanded 7.6 percent in 2013, according to a State Council report last month, the weakest pace in 14 years. Growth will slow to 7.4 percent in 2014, based on the median estimate of 48 economists surveyed by Bloomberg News last month, which would be the lowest since 1990.

(Source: Bloomberg)