Litecoin: Analysis of the Pioneering Cryptocurrency’s Impact on Digital Finance

April 10, 2026July 31, 2024 by Snehasish CHINARA

In this article, Snehasish CHINARA (ESSEC Business School, Grande Ecole Program – Master in Management, 2022-2024) explains cryptocurrency Litecoin, shedding light on its impact and value propositions for digital finance.

Historical context and background

Litecoin, often referred to as the “silver to Bitcoin’s gold,” emerged in 2011 as one of the earliest altcoins, or alternative cryptocurrencies, following the launch of Bitcoin in 2009. It was created by Charlie Lee, a former Google engineer and Coinbase employee. Lee designed Litecoin with the intention of addressing some of the perceived limitations of Bitcoin, such as transaction speed and scalability.

One of the key innovations of Litecoin was its adoption of the Scrypt hashing algorithm instead of Bitcoin’s SHA-256 algorithm. This choice made Litecoin more accessible to individual miners using consumer-grade hardware, as it reduced the advantage of specialized mining equipment known as ASICs (Application-Specific Integrated Circuits). As a result, Litecoin initially gained popularity among miners and enthusiasts who sought a more democratic and decentralized mining ecosystem.

Litecoin also introduced a faster block generation time compared to Bitcoin, with new blocks being created approximately every 2.5 minutes instead of every 10 minutes. This faster block time enabled quicker transaction confirmations, making Litecoin more suitable for everyday transactions.

Over the years, Litecoin has established itself as one of the most prominent cryptocurrencies in the market, often considered a reliable and stable digital asset. Its longevity and consistent development have contributed to its reputation as a credible alternative to Bitcoin.

Litecoin’s journey has been marked by various milestones, including network upgrades, partnerships, and integrations into payment systems and exchanges. Despite facing competition from other cryptocurrencies and undergoing market fluctuations, Litecoin has maintained a strong community of supporters and continues to be actively traded and utilized for various purposes, including payments, remittances, and investment.

Litecoin Logo

Source: Litecoin

Figure 1. Key Dates in Litecoin History

Source: Yahoo! Finance.

Key features

Scrypt Algorithm

Unlike Bitcoin’s SHA-256 algorithm, Litecoin utilizes the Scrypt hashing algorithm for its proof-of-work consensus mechanism. This algorithm was chosen to enable faster block generation and to promote more decentralized mining by reducing the advantage of specialized mining hardware (Application-Specific Integrated Circuits (ASIC) versus consumer-grade hardware like standard PCs).

Faster Block Time

Litecoin has a target block time of approximately 2.5 minutes, compared to Bitcoin’s 10 minutes. This faster block time allows for quicker transaction confirmations, making Litecoin more suitable for everyday transactions.

Higher Maximum Coin Supply

Litecoin has a maximum coin supply limit of 84 million coins, four times the maximum supply of Bitcoin. This larger supply aims to facilitate more widespread adoption and usage while still maintaining scarcity.

Segregated Witness (SegWit) Activation

Litecoin was one of the first major cryptocurrencies to activate Segregated Witness (SegWit), a protocol upgrade aimed at improving transaction throughput and scalability. SegWit also paved the way for the implementation of the Lightning Network on Litecoin, enabling off-chain transactions for faster and cheaper payments.

Atomic Swaps

Litecoin has been at the forefront of implementing Atomic Swaps, a technology that allows for the trustless exchange of cryptocurrencies across different blockchains without the need for intermediaries like crypto platforms. This feature enhances interoperability and decentralization within the cryptocurrency ecosystem.

Litecoin Improvement Proposals (LIPs)

Similar to Bitcoin Improvement Proposals (BIPs), Litecoin has its own proposal system called Litecoin Improvement Proposals (LIPs). These proposals allow community members to suggest changes or improvements to the Litecoin protocol, fostering a transparent and collaborative development process.

Use cases

Peer-to-Peer Payments

Litecoin’s fast transaction confirmations and low fees make it suitable for peer-to-peer transactions. Users can quickly send and receive funds across the globe without relying on traditional banking systems, making Litecoin an efficient option for remittances and international payments.

Online Purchases

As of 2023, over 2,000 online merchants and service providers accept Litecoin as a form of payment globally. Litecoin’s transaction volume has steadily increased, with an average of over 100,000 transactions per day. In 2022, Litecoin processed over 35 million transactions, highlighting its growing use for everyday payments. Many online merchants and service providers accept Litecoin as a form of payment. There are over 5,000 cryptocurrency ATMs worldwide that support Litecoin, allowing users to buy and sell LTC with cash. Users can use Litecoin to purchase a wide range of goods and services, including electronics, clothing, digital products, and more.

Micropayments

Litecoin’s low transaction fees and fast processing times make it well-suited for micropayments, enabling users to make small transactions economically. This use case is particularly relevant for content creators, online tipping, and pay-per-view services.

Cross-Border Transactions

Litecoin’s borderless nature makes it an attractive option for cross-border transactions, as users can avoid the high fees and long processing times associated with traditional remittance services and bank transfers.

Privacy Transactions

While not as focused on privacy as some other cryptocurrencies like Monero or Zcash, Litecoin offers a degree of privacy through features like confidential transactions and the option to use privacy-enhancing wallets. This makes Litecoin appealing for users who prioritize privacy in their transactions.

Technology and underlying blockchain

Litecoin operates on a blockchain-based decentralized network, sharing many similarities with Bitcoin while incorporating several key technical differences. At its core, Litecoin’s blockchain serves as a distributed ledger that records all transactions made with its native cryptocurrency, LTC. One of the distinguishing features of Litecoin is its utilization of the Scrypt proof-of-work algorithm, which differs from Bitcoin’s SHA-256 algorithm. This algorithm was chosen to promote a more equitable mining process, allowing individuals to mine LTC using consumer-grade hardware and reducing the dominance of specialized mining equipment.

The Litecoin blockchain maintains a target block time of approximately 2.5 minutes, significantly faster than Bitcoin’s 10-minute block time. This faster block generation rate enables quicker transaction confirmations, making Litecoin well-suited for use in everyday transactions and enhancing its scalability. Additionally, Litecoin implemented Segregated Witness (SegWit) in 2017, a protocol upgrade aimed at improving transaction throughput and reducing network congestion by separating transaction signatures from transaction data.

Furthermore, Litecoin has experimented with technologies like the Lightning Network, a layer-2 scaling solution designed to facilitate instant and low-cost transactions by leveraging payment channels. This technology enables off-chain transactions that can be settled on the Litecoin blockchain, further enhancing its transaction speed and efficiency.

Supply of coins

Figure Figure 2. Litecoin Supply

Source: Yahoo! Finance.

Litecoin’s coin supply is governed by its protocol, which dictates the issuance rate and maximum supply limit. Unlike traditional fiat currencies that are subject to centralized control by governments and central banks, Litecoin operates on a decentralized network secured by blockchain technology. The issuance of new Litecoin coins occurs through a process called mining, where miners use computational power to validate transactions and add new blocks to the blockchain.

Litecoin employs a deflationary monetary policy, with a fixed issuance schedule that halves the block reward approximately every four years. Initially, the block reward was set at 50 Litecoins per block, but it reduces by half every 840,000 blocks. This process, known as “halving,” aims to curb inflation over time and maintain scarcity, similar to Bitcoin’s issuance schedule. As of now, the block reward stands at 12.5 Litecoins per block, and this rate will continue to halve periodically until the maximum supply of 84 million Litecoins is reached.

The predictable issuance schedule and maximum supply cap of Litecoin contribute to its scarcity and value proposition, aligning with principles of sound money and monetary decentralization. This transparent and algorithmic approach to coin issuance fosters confidence among users and investors, as it prevents arbitrary inflation and ensures the integrity of Litecoin’s monetary policy over the long term.

Historical data for Litecoin

How to get the data?

The Litecoin is popular cryptocurrency on the market, and historical data for the Litecoin such as prices and volume traded can be easily downloaded from the internet sources such as Yahoo! Finance, Blockchain.com & CoinMarketCap. For example, you can download data for Litecoin on Yahoo! Finance (the Yahoo! code for Litecoin is LTC-USD).

Figure Figure 3. Litecoin data

Source: Yahoo! Finance.

Historical data for the Litecoin market prices

Since its inception in 2011, Litecoin has undergone multiple bull and bear cycles, with its price witnessing remarkable volatility. In its early years, Litecoin’s market price remained relatively low, often trading at a fraction of Bitcoin’s value. However, as the cryptocurrency market gained traction and Litecoin’s utility as a fast and affordable payment method became recognized, its price began to appreciate steadily. The price of Litecoin experienced its first major surge in late 2013, reaching an all-time high above $50 USD. This rally was fueled by increased adoption, media attention, and speculation within the cryptocurrency community.

Following the 2013 peak, Litecoin underwent a prolonged bear market, with its price declining significantly over the subsequent years. However, Litecoin’s resilience and active development continued to attract interest, leading to periodic price rallies and subsequent corrections. The cryptocurrency market’s overall volatility, regulatory uncertainty, and competition from other digital assets also influenced Litecoin’s price movements during this period.

One of the most significant price rallies in Litecoin’s history occurred during the cryptocurrency bull market of 2017-2018. During this period, Litecoin’s price surged to unprecedented levels, reaching an all-time high of over $300 USD in December 2017. This rally was fueled by factors such as increased mainstream adoption, the integration of Segregated Witness (SegWit) and the Lightning Network, and speculative buying spurred by the broader cryptocurrency market rally.

Since the 2017-2018 bull market, Litecoin has experienced periods of both consolidation and volatility. While its price has not reached the same highs as during the peak of the bull market, Litecoin has maintained a relatively stable position within the cryptocurrency market, often regarded as one of the top digital assets by market capitalization. The ongoing development of Litecoin’s protocol, partnerships, and adoption efforts continue to shape its market prices, as investors and enthusiasts closely monitor its evolution in the broader cryptocurrency landscape.

Figure 4 below represents the evolution of the price of Litecoin in US dollar over the period September 2014 – May 2024. The price corresponds to the “closing” price (observed at 10:00 PM CET at the end of the month).

Figure 4. Evolution of Litecoin price

Source: Yahoo! Finance.

R program

The R program below written by Shengyu ZHENG allows you to download the data from Yahoo! Finance website and to compute summary statistics and risk measures about the Litecoin.

Data file

The R program that you can download above allows you to download the data for the Litecoin from the Yahoo! Finance website. The database starts on September 2014.

Table 1 below represents the top of the data file for the Litecoin downloaded from the Yahoo! Finance website with the R program.

Table 1. Top of the data file for the Litecoin

Source: computation by the author (data: Yahoo! Finance website).

Python code

You can download the Python code used to download the data from Yahoo! Finance.

Python script to download Litecoin historical data and save it to an Excel sheet:

import yfinance as yf

import pandas as pd

# Define the ticker symbol for Cardano “ADA-USD”

Litecoin_ticker = “LTC-USD”

# Define the date range for historical data

start_date = “2014-09-01”

end_date = “2024-04-30”

# Download historical data using yfinance

CLitecoin_data = yf.download(Litecoin_ticker, start=start_date, end=end_date)

# Create a Pandas DataFrame from the downloaded data

Litecoin_df = pd.DataFrame(Litecoin_data)

# Define the Excel file path

excel_file_path = ” Litecoin_historical_data.xlsx”

# Save the data to an Excel sheet

Litecoin_df.to_excel(excel_file_path, sheet_name=”Litecoin Historical Data”)

print(f”Data saved to {excel_file_path}”)

# Make sure you have the required libraries installed and adjust the “start_date” and “end_date” variables to the desired date range for the historical data you want to download.

Evolution of the Litecoin

Figure 5 below gives the evolution of the Litecoin on a daily basis.

Figure 5. Evolution of the Litecoin

Source: computation by the author (data: Yahoo! Finance website).

Figure 6 below gives the evolution of the Litecoin returns from September 2014 to May 2024 on a daily basis.

Figure 6. Evolution of the Litecoin returns.

Source: computation by the author (data: Yahoo! Finance website).

The R program that you can download above also allows you to compute summary statistics about the returns of the Litecoin.

Table 2 below presents the following summary statistics estimated for the Litecoin:

The mean

The standard deviation (the squared root of the variance)

The skewness

The kurtosis.

The mean, the standard deviation / variance, the skewness, and the kurtosis refer to the first, second, third and fourth moments of statistical distribution of returns respectively.

Table 2. Summary statistics for Litecoin

Source: computation by the author (data: Yahoo! Finance website).

Statistical distribution of the Litecoin returns

Historical distribution

Figure 7 represents the historical distribution of the Litecoin daily returns for the period from September 2014 to May 2024.

Figure 7. Historical distribution of Litecoin returns.

Source: computation by the author (data: Yahoo! Finance website).

Gaussian distribution

The Gaussian distribution (also called the normal distribution) is a parametric distribution with two parameters: the mean and the standard deviation of returns. We estimated these two parameters over the period from September 2014 to May 2024.

Figure 9 below represents the Gaussian distribution of the Litecoin daily returns with parameters estimated over the period from September 2014 to May 2024.

Figure 8. Gaussian distribution of the Litecoin returns.

Source: computation by the author (data: Yahoo! Finance website).

Risk measures of the Litecoin returns

The R program that you can download above also allows you to compute risk measures about the returns of the Litecoin.

Table 3 below presents the following risk measures estimated for the Litecoin:

The long-term volatility (the unconditional standard deviation estimated over the entire period)

The short-term volatility (the standard deviation estimated over the last three months)

The Value at Risk (VaR) for the left tail (the 5% quantile of the historical distribution)

The Value at Risk (VaR) for the right tail (the 95% quantile of the historical distribution)

The Expected Shortfall (ES) for the left tail (the average loss over the 5% quantile of the historical distribution)

The Expected Shortfall (ES) for the right tail (the average loss over the 95% quantile of the historical distribution)

The Stress Value (SV) for the left tail (the 1% quantile of the tail distribution estimated with a Generalized Pareto distribution)

The Stress Value (SV) for the right tail (the 99% quantile of the tail distribution estimated with a Generalized Pareto distribution)

Table 3. Risk measures for the Litecoin

Source: computation by the author (data: Yahoo! Finance website).

The volatility is a global measure of risk as it considers all the returns. The Value at Risk (VaR), Expected Shortfall (ES) and Stress Value (SV) are local measures of risk as they focus on the tails of the distribution. The study of the left tail is relevant for an investor holding a long position in the Litecoin while the study of the right tail is relevant for an investor holding a short position in the Litecoin.

Why should I be interested in this post?

This blog offers an intriguing journey into the world of Litecoin, tailored for both newcomers and seasoned cryptocurrency enthusiasts alike. It unveils the innovative features and unique characteristics that set Litecoin apart in the digital currency landscape. From its inception to its current standing, we explore Litecoin’s historical journey, shedding light on its pivotal moments and market dynamics. Whether you’re intrigued by its faster block time or its active development community, this post provides a comprehensive understanding of Litecoin’s significance and potential. Whether you’re a curious observer or an investor seeking new opportunities, join us as we delve into the fascinating world of Litecoin and uncover its role in shaping the future of decentralized finance.

Useful resources

Academic research about risk

Longin F. (2000) From VaR to stress testing: the extreme value approach Journal of Banking and Finance, N°24, pp 1097-1130.

Longin F. (2016) Extreme events in finance: a handbook of extreme value theory and its applications Wiley Editions.

Data

Yahoo! Finance

Yahoo! Finance Historical data for Litecoin

CoinMarketCap Historical data for Litecoin

About the author

The article was written in July 2024 by Snehasish CHINARA (ESSEC Business School, Grande Ecole Program – Master in Management, 2022-2024).

Investissements Durables : Le Nouveau Visage de la Finance

July 28, 2024 by Eya FARHOUD

Investissements Durables : Le Nouveau Visage de la Finance

Dans cet article, (ESSEC Business School, Grande Ecole – Master in Management, 2023-2026) explore le nouveau visage de la finance avec les investissements durables.

Introduction

Dans un monde où les enjeux environnementaux, sociaux et de gouvernance (ESG) prennent une place de plus en plus prépondérante, les investissements durables émergent comme une alternative de choix sur les marchés financiers. Cette tendance, autrefois marginale, gagne désormais en popularité et en influence, offrant aux investisseurs la possibilité de concilier rentabilité financière et impact positif sur la société et l’environnement.

Qu’est-ce que les investissements durables ? Les investissements durables, également connus sous le nom d’investissements socialement responsables (ISR) ou d’investissements à impact, consistent à allouer des fonds à des entreprises et des projets qui intègrent des critères ESG dans leur stratégie et leur gouvernance. Ces critères peuvent inclure la réduction des émissions de carbone, la promotion de la diversité et de l’inclusion, ou encore le respect des droits de l’homme.

Les avantages des investissements durables

Les investissements durables offrent plusieurs avantages tant aux investisseurs qu’à la société dans son ensemble. Sur le plan financier, de nombreuses études ont montré que les entreprises qui intègrent des pratiques durables tendent à être plus résilientes et à générer des rendements financiers supérieurs à long terme. De plus, investir dans des entreprises qui contribuent positivement à la société et à l’environnement peut être source de satisfaction morale pour les investisseurs, qui voient leur argent travailler en faveur d’un monde meilleur.

L’essor de l’investissement durable

Au cours des dernières années, l’investissement durable a connu une croissance exponentielle, attirant l’attention des investisseurs institutionnels, des fonds de pension et même des particuliers. Les actifs sous gestion intégrant des critères ESG ont atteint des niveaux record, témoignant de l’engagement croissant en faveur d’une finance plus responsable et éthique.

Les défis et les opportunités

Malgré son essor rapide, l’investissement durable fait face à plusieurs défis, notamment celui de la standardisation des critères ESG et de la mesure de l’impact réel des investissements. Cependant, ces défis sont également source d’opportunités, d’innovation et de progrès dans le domaine de la finance durable.

Articles connexes sur le blog SimTrade

▶ Anant JAIN Dow Jones Sustainability Index

▶ Anant JAIN The World 10 Most Sustainable Companies in 2021

Ressources utiles

Muriel Motte (29/01/2024) Les Américains désertent les fonds d’investissement durables, L’opinion.

A propos de l’auteur

Cet article a été écrit en Avril 2024 par Eya FARHOUD (ESSEC Business School, Grande Ecole – Master in Management, 2023-2026).

Le règne des Algorithmes de Trading Haute Fréquence : Bénéfices et Risques

April 30, 2026July 28, 2024 by Eya FARHOUD

Dans cet article, Eya FARHOUD (ESSEC Business School, Grande Ecole – Master in Management, 2023-2026) explique les bénéfices et risques du Trading Haute Fréquence (THF).

Introduction

Depuis les dernières décennies, les marchés financiers ont été témoins d’une révolution silencieuse mais omniprésente : l’avènement des algorithmes de trading haute fréquence (THF) ou High Frequency Trading (HFT). Ces systèmes informatiques ultra-rapides sont devenus des acteurs majeurs sur les marchés mondiaux, modifiant profondément la dynamique traditionnelle du trading et suscitant à la fois admiration et inquiétude.

Qu’est-ce que le trading haute fréquence ? Le THF est une méthode de négociation qui utilise des algorithmes informatiques pour exécuter un grand nombre d’ordres à des vitesses extrêmement élevées. Ces algorithmes analysent en temps réel les données du marché, prennent des décisions d’achat ou de vente et exécutent les transactions en une fraction de seconde, parfois même en microsecondes. Selon un rapport publié en 2023 par la Securities and Exchange Commission (SEC), le trading haute fréquence représentait environ 50% et 60% des transactions sur les marchés boursiers américains.

Les avantages du trading haute fréquence

Les partisans du trading haute fréquence mettent en avant plusieurs avantages de cette approche. Tout d’abord, la vitesse. Les algorithmes HFT permettent aux traders de saisir les opportunités de marché en temps réel, exploitant les écarts de prix minuscules qui peuvent survenir en l’espace de quelques millisecondes. Ensuite, l’efficacité. Les transactions étant automatisées, le trading haute fréquence permet de réduire les coûts de transaction et d’optimiser l’exécution des ordres. Plus concrètement, selon une étude de la Banque Centrale Européenne, le THF a contribué à réduire les coûts de transaction de l’ordre de 5 à 10 % sur les marchés européens entre 2015 et 2020.

Les défis et les risques

Cependant, le trading haute fréquence n’est pas sans ses critiques et ses risques. L’un des principaux défis est lié à la volatilité. La nature ultra-rapide du trading HFT peut parfois amplifier les mouvements de marché, créant des flash crashes et des situations de panique. Il existe également des préoccupations concernant l’équité et la transparence du marché, certains accusant les traders haute fréquence de bénéficier d’un accès privilégié à l’information et de manipuler les marchés à leur avantage.

La réglementation et l’avenir du trading haute fréquence

Face à ces défis, les régulateurs financiers du monde entier ont commencé à prendre des mesures pour encadrer le trading haute fréquence. Aux États-Unis, par exemple, la SEC a adopté des règles visant à améliorer la transparence et la surveillance des marchés, notamment en imposant des obligations de reporting plus strictes pour les opérations effectuées par les traders haute fréquence. Malgré ces préoccupations et réglementations, le trading haute fréquence continue de prospérer et d’évoluer. Les avancées technologiques telles que l’intelligence artificielle et le machine learning promettent de rendre les algorithmes encore plus sophistiqués et réactifs aux conditions du marché. L’avenir du trading haute fréquence reste donc incertain, mais une chose est sûre : son impact sur les marchés financiers continuera d’être au cœur des débats et des discussions pour les années à venir.

Articles connexes sur le blog SimTrade

▶ Akshit GUPTA High-frequency trading

▶ Clara PINTO High-frequency trading and limit orders

▶ Shruti CHAND High-frequency trading: pros and cons

Ressources utiles

Luc Goupil (2013) Trading à haute fréquence : empreinte de marché et enjeux de régulation Revue d’économie financière 110, 277-294.

A propos de l’auteure

Cet article a été écrit en Juillet 2024 par Eya FARHOUD (ESSEC Business School, Grande Ecole – Master in Management, 2023-2026).

Top financial innovations in the 20th century

February 18, 2026July 25, 2024 by Nithisha CHALLA

In this article, Nithisha CHALLA (ESSEC Business School, Grande Ecole Program – Master in Management (MiM), 2021-2024) presents top financial innovations of the 20th century that have brought significant changes in people’s life.

Introduction

Financial innovations have significantly transformed how people make transactions and manage money like saving and investing. These innovations have increased accessibility, convenience, and security in financial activities, benefiting individuals and companies alike. From the introduction of paper money in ancient China to modern-day digital banking, each era has brought new ways to manage finances. The 20^th and 21^st centuries, in particular, have seen rapid advancements due to technology, leading to groundbreaking changes in financial services.

Top Financial Innovations that Changed People’s Life in the 20^th century

Our selection of financial innovations is based on their wide adoption by firms and individuals (usage in many countries worldwide).

Credit Cards and Debit Cards: Introduced in the 1950s, credit and debit cards provided a convenient way for consumers to make purchases without cash, leading to a shift towards a cashless society.
Automated Teller Machines (ATMs): ATMs revolutionized banking by allowing customers to perform transactions anytime, anywhere, without needing to visit a bank branch.
Telephone Banking: The rise of the internet in the 1980s enabled banks to allow customers to perform basic banking transactions, such as checking account balances and transferring funds, via phone.
Online Banking: The rise of the internet in the 1990s enabled banks to offer online services, making it easier for customers to manage accounts, pay bills, and transfer money.

We explain below how these financial innovations impacted people’s lives and companies. We also give some statistics to measure the impact.

Credit Cards and Debit Cards

The Diners Club card, introduced by Frank McNamara card in 1950, is considered the first credit. Later, Bank of America launched the BankAmericard (now Visa) in 1958. Later, Visa became one of the largest credit card issuers globally. MasterCard, originally Interbank Card Association, formed in 1966, is another major player in the credit card industry. The concept of a debit card was first introduced by the First National Bank of Seattle in 1966. The first debit card was issued by Barclays in the UK in 1966.

These Credit and Debit cards provided consumers a convenient and secure way to purchase without carrying cash. It allowed for the development of the credit industry, enabling consumers to borrow funds for purchases and pay them back over time. Which also helped customers make larger purchases thus improving purchasing power.

To speak on how much these innovations affected people, by the end of the 20th century, there were over 1 billion credit cards in use globally. And in 2019, Visa and MasterCard together processed over 171 billion transactions worldwide. In terms of debit card transactions, it recorded over 100 billion debit card transactions globally in 2020.

First ever credit card picture

Source: Time news letter

Figure 1 below presents the evolution of the size of the credit card industry in the United States from 2013 to 2023.

Figure 1. The market size of the US credit card industry
US market evolution of Credit cards industry
Source: Time news letter

Automated Teller Machines (ATMs)

John Shepherd-Barron is credited with inventing the first ATM, which was installed by Barclays Bank in London in 1967. Later, Diebold Nixdorf and NCR Corporation became the major manufacturers of ATMs in the 1980’s till date.

These ATMs provided 24/7 access to banking services, allowing customers to withdraw cash, check balances, and perform other transactions without needing to visit a bank branch. Hence enhanced convenience and reduced the need for in-person banking services. Helping in reducing queues at banks and improving transaction speed. Overall, this innovation has increased accessibility, convenience, and efficiency both for banks and for the consumers.

To speak on how much these innovations affected people, by 1990, there were around 100,000 ATMs worldwide. As of 2020, there are approximately 3.2 million ATMs globally. The global ATM market was valued at around $18.4 billion in 2019.

First ever ATM picture

Source: Time news letter

Figure 2 below presents the evolution of the globally installed of ATM bases in the period of 2009 to 2020.

Figure 2. ATM global evolution

Source: Time news letter

Telephone Banking

Midland Bank (now part of HSBC) launched the first telephone banking service in the UK in 1989. HSBC pioneered telephone banking services and Citibank also offered telephone banking as part of its service portfolio being one of the early adopters of telephone banking. This is considered the innovation of the 1980-1990 decade.

This innovation has allowed customers to perform basic banking transactions, such as checking account balances and transferring funds, via phone. Provided a convenient alternative to visiting a bank branch, especially for those without internet access, and reduced risks associated with carrying cash or checks.

To speak on how much these innovations affected people, by the late 1990s, telephone banking was widely adopted, with millions of users globally. Despite the rise of online and mobile banking in the 21^st century, telephone banking remains a valuable service for many customers, particularly the elderly and those in rural areas. In 2019, an estimated 5% of U.S. adults still used telephone banking. And by 2000, more than 50% of U.S. banks offered telephone banking services.

First ever touch-tone telephone banking machine in 1973.
First ever telephone banking machine picture
Source: ZB Media

Figure 1 shows what the first ever telephone banking machine looked like in 1973.

Online Banking

The concept of online baking was developed by banks like Stanford Federal Credit Union, which offered the first online banking services in 1994. Bank of America was one of the early adopters of online banking and Wells Fargo Launched its first internet banking service in 1995.

This innovation has provided customers with the ability to manage their accounts, pay bills, transfer funds, and perform other banking activities from the comfort of their homes. It reduced the need for physical bank branches and made banking services more accessible.

To speak on how much these innovations affected people, by 2019, 76% of U.S. adults used online banking. The global online banking market was valued at $9.2 billion US dollars in 2019. And global online banking users are expected to reach 2.5 billion by 2024.

First ever Online banking machine in 1980.

Source: Fintech Magazine

Figure 1 shows what the first-ever Online banking machine looked like in 1980.

Conclusion

Financial innovations have profoundly transformed the way individuals and businesses interact with money. From the widespread adoption of credit cards to mobile payments these innovations have made financial services more accessible, efficient, and secure. As technology continues to advance, the financial landscape will undoubtedly see further changes, continuing to shape and improve people’s lives worldwide.

Why should I be interested in this post?

Management students, as future leaders and decision-makers, should understand financial innovations for several compelling reasons. These innovations not only influence the financial landscape but also have significant implications for strategic decision-making, operational efficiency, and competitive advantage.

Useful resources

Wikipedia Financial Innovations

Fintech Magazine Online Banking 1973 – History of Computers

ZB Media Technology in Fintech and the story of Online Banking

Research gate The emergence of financial innovation and its governance – a historical literature review

Axis bank Credit card: A cashless surge

Allied market research Mobile Payment Market Expected to Reach $12.06 Trillion by 2027

Cambridge University Press Banking and Finance in the Twentieth Century

About the author

The article was written in July 2024 by Nithisha CHALLA (ESSEC Business School, Grande Ecole Program – Master in Management (MiM), 2021-2024).

The Yield Curve

September 4, 2025July 11, 2024 by Ziqian ZONG

The Yield Curve

In this article, Ziqian ZONG (ESSEC Business School, Global BBA exchange, 2024) presents a comprehensive overview of the yield curve and its importance in bond markets. The article also explores the different types of Treasury securities and the various term structures of yield curves.

This article is structured as follows: we start with an introduction to the concept of the yield curve. Then, we discuss the types of Treasury securities and the different term structures of yield curves. Next, we delve into the reasons for different yield spreads and the importance of the yield curve. Finally, we explain the phenomenon of the inverted yield curve and its implications.

Introduction

The yield curve is a fundamental concept in bond markets that depicts the relationship between interest rates (or yields) and different maturities of debt securities, typically government bonds. It is a powerful tool for analyzing the economic outlook, making investment decisions, and pricing bonds.

The type of the yield curve

The term structure of the yield curve shows the yields of bonds with equal credit quality but different maturity dates. It provides a snapshot of how interest rates vary over short, medium, and long-term maturities. For example, there is a yield curve for the securities issued by the government in each country. In the United States, Treasury securities, issued by the U.S. Department of the Treasury, are called according to their maturity: Treasury bills, Treasury notes, and Treasury bonds.

Treasury Bills (T-Bills)

Treasury bills (T-Bills) are short-term securities with maturities of one year or less. They do not pay periodic interest; instead, they are sold at a discount from their face value, and the interest earned is the difference between the purchase price and the face value paid at maturity. T-Bills are primarily used for short-term government financing needs and generally offer lower yields due to their shorter maturities and lower risk of interest rate fluctuations.

Treasury Notes (T-Notes)

Treasury notes (T-Notes) are medium-term securities with maturities ranging from two to ten years. They pay semi-annual interest at a fixed rate and return the face value at maturity. T-Notes are used for intermediate-term government financing and typically offer higher yields than T-Bills, reflecting the increased risk associated with a longer investment period.

Treasury Bonds (T-Bonds)

Treasury bonds (T-Bonds) are long-term securities with maturities exceeding ten years, often up to 30 years. They also pay semi-annual interest at a fixed rate and return the face value at maturity. T-Bonds are utilized for long-term government financing and offer the highest yields among the three types of Treasury securities, compensating investors for the longer maturity and greater interest rate risk.

Figure 1 below gives the yield curve for the Treasuries in the United States on June 28, 2024.

Yield curve for US Treasuries (28/06/2024)

Source: U.S. Department of Treasury

You can download below the Excel file for the data used to build the figure for the yield curve for US Treasuries.

Different types of yield curves

Normal Yield Curve

This upward-sloping curve indicates that longer-term bonds have higher yields to maturity (YTM) than shorter-term bonds. This shape reflects expectations of rising interest rates and economic growth, as investors demand higher returns for locking in their money over a longer period.

Inverted Yield Curve

This downward-sloping curve occurs when shorter-term bonds have higher YTM than longer-term bonds. This unusual situation often signals an impending economic recession, as investors expect future interest rates to decline.

Flat Yield Curve

When YTM across various maturities are similar, it suggests economic uncertainty, with no clear direction for future interest rates. Investors are indifferent to holding bonds of different maturities, reflecting mixed signals about future economic conditions.

Hump-Shaped Yield Curve

This curve shows higher YTM for medium-term bonds compared to both short-term and long-term bonds. This shape, often referred to as a “hump,” can indicate specific market conditions, such as expectations of moderate economic growth or short-term inflation pressures. This leads to increased demand for intermediate-term securities like T-Notes, pushing up their yields relative to both short-term and long-term bonds.

Figure 2 below gives different types of yield curves.

Types of yield curves

Source: Ziqian ZONG

You can download below the Excel file used to build the figure for the different types of yield curve.

Reasons for different yield spreads

Market expectations of future interest rates play a crucial role in shaping the yield curve. The link between spot rates (current interest rates for immediate borrowing or lending) and forward rates (expected future interest rates) is essential in this analysis. In a two-period model, for example, the yield on a two-year bond can be seen as a combination of the yield on a one-year bond today and the expected yield on a one-year bond one year from now. This relationship helps investors infer the market’s expectations of future rates from the current yield curve.

The term premium, which compensates investors for the risk associated with holding longer-term securities, also plays a crucial role in shaping the yield curve. Changes in risk aversion and market uncertainty can lead to fluctuations in the term premium, which in turn can affect the slope of the yield curve independently of monetary policy actions. When investors perceive higher risks, they demand a higher term premium, causing long-term yields to rise relative to short-term yields. Conversely, when market uncertainty decreases, the term premium declines, potentially flattening or inverting the yield curve even if central bank policies remain unchanged.

Importance of the Yield Curve

The yield curve serves as a crucial barometer for various aspects of the financial markets, providing insights into economic conditions, guiding investment decisions, and informing monetary policy.

The shape of the yield curve is a widely recognized predictor of economic growth or recession. Historically, an inverted yield curve, where short-term yields exceed long-term yields, has often preceded economic recessions. For example, prior to the 2008 financial crisis, the yield curve inverted in late 2006 and early 2007, signaling the forthcoming downturn. However, it’s important to note exceptions, such as the 1966 and 1998 inversions, which did not lead to immediate recessions, illustrating that while the yield curve is a powerful tool, it is not infallible.

Investors closely monitor the yield curve to determine the relative attractiveness of short-term versus long-term investments. A steep yield curve, where long-term yields are significantly higher than short-term yields, suggests expectations of economic growth and inflation, encouraging investment in long-term bonds. Conversely, a flat or inverted yield curve might indicate economic uncertainty or a potential recession, prompting investors to favor shorter-term securities. For instance, during the late 1990s dot-com bubble, the yield curve flattened, signaling caution and influencing investment strategies towards shorter maturities.

Central banks, such as the Federal Reserve, scrutinize the yield curve to gauge the impact and effectiveness of their monetary policies. A steepening yield curve often signals that monetary easing, such as lowering interest rates, may be warranted to stimulate economic growth. Conversely, a flattening or inverted yield curve can indicate that monetary tightening is needed to curb inflation. For example, in the early 1980s, the Federal Reserve, under Chairman Paul Volcker, aggressively raised short-term interest rates to combat inflation, leading to a significant inversion of the yield curve.

The Inverted Yield Curve

An inverted yield curve is a financial phenomenon where short-term interest rates surpass long-term rates. An inversion of this curve is seen as an anomaly and is closely monitored by economists and investors for its historical role as a predictor of economic recessions.

Common Indicators to Measure Yield Curve Inversion

10-Year Treasury Note vs. 1-Year Treasury Note is one of the most commonly used indicators to measure the yield curve. It compares the yield on the 10-year U.S. Treasury note with the yield on the 1-year U.S. Treasury note.

Reasons for Inversion

Monetary Policy: When central banks raise short-term interest rates to combat inflation, it can lead to an inverted yield curve.
Economic Expectations: Investors may expect slower economic growth or a recession, leading them to prefer long-term bonds for their perceived safety, driving down long-term yields.

Why should I be interested in this post?

Understanding the yield curve is essential for analyzing economic conditions, making informed investment decisions, and understanding market expectations. This article provides valuable insights into how interest rates affect the bond market and the broader economy, offering practical knowledge for anyone involved in finance or investment.

Useful resources

Academic resources

Fabozzi, F.J., & Mann, S.V. (2012) Appendix 2: Yield Curves. In The Handbook of Fixed Income Securities (8th ed.). Wiley.

Business resources

U.S. Department of the Treasury. Interest Rate Statistics.

About the author

The article was written in July 2024 by Ziqian ZONG (ESSEC Business School, Global BBA exchange, 2024).

The environmental impact of cocoa

February 17, 2026July 10, 2024 by Mathis DIALLO

In this article, Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026) explains what the environmental repercussions of the production and supply of cocoa are.

Introduction

The carbon footprint is an which measures the anthropogenic greenhouse gas emissions, i.e. a measure of the emissions that can be attributed to that human activity. Unfortunately, chocolate produces a lot of green gas emissions. Growing and harvesting cocoa, making chocolate, transportation, packaging: each stage of production produces greenhouse gases.

Figure 1 gives the process flowchart for cocoa production designed by Sucden (a French trading company specializing in soft commodities and mainly in sugar).

Process flowchart for cocoa production

Source: Sucden.

Global cocoa production therefore has a significant environmental impact. However, chocolate can also influence the climate and deforestation. Indeed, the manufacture of this product has a negative impact on the environment. Certain prints also have an impact on cocoa plantations.

Cocoa’s carbon footprint

It seems fair to say that chocolate’s carbon footprint is far from acceptable. A kilo of chocolate has a carbon footprint of around 13.7kg of CO² (data from the Agribalyse database). The two factors that will influence the increase or decrease of this figure are either the type of chocolate, or its impact on deforestation. It means that some types of chocolates may need more transformation than others, which implies that there will be more chances to require some other products which have some influence in the green gas emissions.

Cocoa production is responsible for 70% of chocolate’s CO² emissions. All subsequent stages are included in the remaining 30%: processing from cocoa to packaging, addition of other foods and transport to the point of sale.

Most cocoa is grown using conventional agricultural methods such as pesticides, machinery and fertilizers. These processes are energy-intensive and directly produce greenhouse gases, with the result that agriculture currently accounts for around 20% of global emissions.

In the case of cocoa beans, there are also processing steps. The cocoa beans are first ground into cocoa powder, then the other ingredients are added:

Cocoa per kilo consumes more greenhouse gases than cow’s milk for milk chocolate or white chocolate, mainly due to the methane associated with livestock farming.
Sugar, palm oil (also responsible for deforestation), preservatives, etc. all contribute to the carbon footprint of chocolate.

The carbon footprint of chocolate is further increased by transport, as cocoa is grown only in countries located around the equator.

The current environmental problems of deforestation caused by cocoa

We have cleared areas of primary forest in Côte d’Ivoire to grow more cocoa. This country, which used to export the most cocoa in the world, has destroyed 90% of its forests in 60 years!

The primary cause of deforestation in West Africa is cocoa farming, which accounts for 70% of the world’s cocoa production.

Since 1960, Côte d’Ivoire has lost 90% of its afforestation. If the trend does not change, the entire Ivorian forest will disappear by 2034, according to some ecologists.

So, given all these problems linked to the production and delivery of cocoa to our market, it’s understandable that some people are reacting. For many specialists, chocolate is the symbol of our globalized system, which he does not hesitate to criticize: “The international cocoa-chocolate market today is the portrait of a capitalism at the end of its rope, locked in its own contradictions: the enormous amount of money invested and mobilized to maintain the levels of production and consumption necessary for the survival of the model completely paralyzes action and innovation”, he explains, painting a rather bitter picture of today’s market.

A glimmer of hope for the future

Even if the market seems to be ticking a lot of the wrong boxes, some people are still trying to change things.

In December 2022, a new European regulation was introduced to prevent the import of products derived from deforestation (the European Union (EU) deforestation-free regulation (EUDR)). . This applies to products such as coffee, cocoa, rubber and palm oil.

By requiring the companies concerned to guarantee that the products they export involve zero or negligible risk of deforestation, these regulations will certainly help the cocoa sector to become more responsible in the future, to the benefit of both producers and our planet.

Why should I be interested in this post?

Thus, we can see how much the process of production of cocoa a significant impact in our environment may have, be it with deforestation, but also with the process of supply chain itself.

▶ Mathis DIALLO The cocoa production

▶ Mathis DIALLO The price of cocoa

▶ Mathis DIALLO Different types of chocolate

▶ Mathis DIALLO The Armarajo hedge fund’s corner in the cocoa market in 2010

Useful resources

Anna Gardner (07/05/2022) The Cocoa Industry: Its Environmental Impacts ClimaTalk

Sucden Products and activities – Cocoa

About the author

The article was written in July 2024 by Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026).

The cocoa production

July 11, 2024July 10, 2024 by Mathis DIALLO

The cocoa production

In this article, Mathis DIALLO ((ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026) explains all the process of the cocoa production (cocoa grinding, types of cocoa).

Introduction

Despite a fairly complex process, cocoa production has continued to increase since the 1980s. In the early 2000s, the cocoa-producing countries as a whole were already producing around 2.9 million tonnes of cocoa.

Between 2000 and 2010, cocoa production even increased by 40%, reaching 4 million tonnes in 2010.

A very old crop

The first links between cocoa and mankind date back a very long time. At that time, cocoa was not cultivated intensively; cocoa trees grew naturally in tropical countries. Indigenous populations used to pick the fruits of the cocoa tree to eat the mucilage that surrounds the cocoa beans. It wasn’t until the pre-Columbian era that the Mayans and Aztecs began to process cocoa beans into cocoa paste, mixing it with other ingredients to make a chocolate drink, the ancestor of our hot chocolate!

Types of cocoa and origins

There are three main types of cocoa: trinitario, forastero and criollo.

However, they are not found in equal quantities around the world.

Criollo accounts for only 5% of world production. Its distinctive features are a light-coloured bean and a fruity, slightly acidic flavour, giving it the ability to produce a fairly fine chocolate. Its rarity makes it a much sought-after chocolate.

Forastero, on the other hand, is the type of cocoa most commonly found in nature, accounting for 80% of the world’s production. It has an earthy, woody flavour, and is used to make chocolate with an intense taste.

Finally, the trinitario, which accounts for around 15% of world production, is in fact a cross between the last two mentioned above. It has a fairly fruity taste with earthy undertones, which is why it is so popular with the general public.

These types of cocoa are mainly found in countries such as Ghana and Côte d’Ivoire, which are now the world’s leading cocoa producers.

The grinding process

Cocoa grinding is an essential stage in the chocolate-making process. It is the process of grinding roasted cocoa beans to produce chocolate liquor, which forms the basis of all chocolate products. Cocoa grinding may seem simple, but it is a complex process that requires specialised equipment and expertise.

Cocoa is ground in several stages: roasting, grinding and refining the cocoa beans. The duration of this process varies from a few hours to several days, depending on the equipment and the desired final product.

Roasting the cocoa beans is the first stage in the cocoa-grinding process. By removing excess moisture, the natural flavours and aromas of the cocoa beans are brought out through roasting. The beans are generally roasted for 10-30 minutes at a temperature of 120 to 140°C.

Once the beans have been roasted, they are cooled and ground to obtain cocoa nibs. The beans are then crushed to obtain a fine cocoa paste, known as chocolate liquor or cocoa liquor. Grinding takes several hours and involves the use of specialised equipment such as blade grinders, paddle grinders and conical stones.

The chocolate liquor is then refined to reduce the granulometry and give the chocolate more texture. Refining involves passing the chocolate liquor through a series of rollers that crush the particles to make them finer. This process can take several hours and involves specialised equipment such as chocolate refiners.

Conching is the final stage in the cocoa grinding process and involves continuously mixing and kneading the chocolate liquor at a controlled temperature. Conching improves the flavour and aroma of the chocolate, as well as its texture and mouthfeel. This phase varies from a few hours to several days depending on the final product desired.

Conclusion

In conclusion, despite a fairly complex process, cocoa production has continued to increase since the 1980s. In the early 2000s, the cocoa-producing countries as a whole were already producing around 2.9 million tonnes of cocoa.

Between 2000 and 2010, cocoa production even increased by 40%, reaching 4 million tonnes in 2010.

Today, production stands at around 5 million tonnes.

Why should I be interested in this post?

Understanding cocoa production is crucial to appreciating its economic, environmental and social impacts, as well as encouraging sustainable and ethical farming practices.

▶ Mathis DIALLO The environmental impact of cocoa

▶ Mathis DIALLO The price of cocoa

▶ Mathis DIALLO Different types of chocolate

▶ Mathis DIALLO The Armarajo hedge fund’s corner in the cocoa market in 2010

Useful resources

International Cocoa Organization (ICCO) Summary of the process of transforming cocoa beans into chocolate

European Cocoa Association (ECA) Cocoa Story: The production process – from cocoa beans to semi finished products

About the author

The article was written in July 2024 by Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026).

The price of cocoa

July 11, 2024July 10, 2024 by Mathis DIALLO

The price of cocoa

In this article, Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026) explains why the price of cocoa may vary so much.

For a long time, the price of cocoa and the fluctuation of its price within the financial markets has been the result of a combination of factors, such as weather conditions (whether favourable or unfavourable), diseases affecting crops (they are not always present, may re-emerge at certain times), etc.

This situation has always raised concerns about the future viability of the cocoa industry and highlights the importance of sustainability and resilience in the global chocolate supply chain.

Evolution of cocoa price.

Source: Trading Economics.

Evolution of the cocoa market price : the drivers of the supply and demand for cocoa

Let’s start with the weather:

The major cocoa-producing regions, such as Côte d’Ivoire and Ghana, are confronted with often unpredictable weather conditions, including droughts and climatic accidents. It is clear that these phenomena can contribute to a reduction in production and therefore to a drop in supply on the world market.

In addition to difficult weather conditions, cocoa crops are also affected by diseases such as the swollen shoot virus. These diseases weaken crops and further reduce the production of cocoa beans for processing.

It’s important to remember that the world’s cocoa production is heavily concentrated in West Africa, particularly Côte d’Ivoire and Ghana. The slightest problem affecting these regions will have a real effect on world cocoa supply and therefore on market price volatility.

The role of speculation

Speculative funds can sometimes fuel price rises, with the latest financial crisis prompting hedge funds to position themselves on the commodities markets. The cocoa side of the NYSE or City is even more susceptible to speculation. Whether there is a shortage or a surplus, speculation is based on the actual causes of the physical market, but exaggerates the trends. In 2017, an overproduction of just 200,000 tonnes caused a 30% fall in the market price, leading to a speculative spiral. Today, the rise in speculation is at the root of this all-time record for cocoa prices. In recent months, financial operators have invested a record 8.7 billion dollars on the New York and London stock exchanges to speculate on a rise in cocoa prices.

So hedge funds are not directly responsible for the increase. They are based primarily on actual causes. Despite their massive injections of liquidity, the market no longer reflects the physical realities of cocoa.

Recent market development (2023-2024)

Figure 2 represents the evolution of the price of cocoa from 2023 to 2024 (USD/T).

Figure 2. Evolution of cocoa price (1923-2024).

Source: Trading Economics.

Background: The last record price was set in 1977 at $5,300 per tonne. It was broken in February 2024. Barely two months later, and defying all projections, the price of cocoa doubled to $10,600 per tonne on 15 April 2024. The following week, it reached $11,479. In one year, the price of cocoa has risen by 268%.

Explanation:

With Easter approaching, a time of year when people consume much more chocolate than usual (buying chocolate eggs), the price of cocoa is hitting record highs on the international market. The price of cocoa has just passed the 6,000 dollars a tonne mark, a rise unprecedented since 1977.

Worse still, on 27 March 2024, the price of a tonne of cocoa exceeded 10,000 dollars a tonne. This was unprecedented for the raw material of chocolate, to the point where Bloomberg noted that the cocoa bean was overtaking Nvidia at that point.

This is the third year in a row that the market has been in deficit, with harvests in West Africa down due to the vagaries of the weather, strong demand and speculation.

The gap between supply and demand is expected to rise to around 430,000 tonnes of cocoa in 2024 (around 8% of normal world production). It is therefore impossible for there to be enough for everyone at the end of the year, and some populations are likely to experience shortages of this product.

But a few weeks later, the price of cocoa ended up declining, and not without reason: 1) renewed rainfall in Nigeria led to a significant increase in production; 2) the Intercontinental Exchange (the main cocoa market) raised the margin on contracts, making it more difficult to find buyers or sellers on the market.

Recent events have largely confirmed the volatility of this type of product on the international financial markets, which is far too dependent on environmental hazards, the number of players on the market and financial market speculation.

Why should I be interested in this post?

It shows how much volatile may the market of raw materials be and enables us to understand better about the fluctuations of price of cocoa.

▶ Mathis DIALLO The environmental impact of cocoa

▶ Mathis DIALLO The cocoa production

▶ Mathis DIALLO Different types of chocolate

▶ Mathis DIALLO The Armarajo hedge fund’s corner in the cocoa market in 2010

Useful resources

Trading Economics Cocoa

International Cocoa Organization (ICCO) Cocoa Market Report for March 2024

World Wide Chocolate Cocoa Cost Soars to Historic High – Why is Cocoa’s Cost Rising? | April 20244

About the author

The article was written in July 2024 by Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026).

Different types of chocolate

July 1, 2025July 10, 2024 by Mathis DIALLO

Different types of chocolate

In this article, Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026) explains about the different types of chocolate.

Introduction

There are many different types of chocolate. Chocolate can be classified into different categories according to its colour, composition, uses, taste, price, etc. Nevertheless, the names of many products are subject to strict regulations, whatever its type or form (paste, bar, confectionery, etc.). For instance, it must contain at least 35% cocoa beans inside (according to the international standards).

Varieties of chocolate

Dark chocolate

The first chocolate to come to mind is often dark chocolate. The designation of dark chocolate is regulated. Chocolate must contain at least 35% cocoa beans to be considered chocolate.

Legislation requires a cocoa concentration of at least 43%, including 26% cocoa butter and 14% cocoa, to qualify as fine or superior dark chocolate. The terroir of the cocoa has a considerable influence on the flavour of dark chocolate. Dark chocolate lovers look for its sometimes bitter, intense and deep flavour.

It is possible to create different dark chocolates that are more or less intense or bitter by adding sugar or flavourings. Master chocolatiers can be creative and create innovative dark chocolates by adding other ingredients such as candied or dried fruit, for example, although the chocolate must have a minimum percentage to be considered a dark chocolate.

Milk chocolate, known as tasty and smooth

Taste is the first thing that distinguishes milk chocolate from dark chocolate. Milk chocolate is appreciated not only by children but also by adults because it is sweeter and less bitter than dark chocolate.

Milk chocolate is made up of :

At least 30% dry, fat-free cocoa.
At least 18% milk.
25% fat, including cocoa butter.
At least 3.5% milk fat.

This type of chocolate can be found in the form of tasting products or ingredients for pastries. It is particularly interesting for creating gourmet desserts, especially at Christmas and Easter, because of its cocoa milk flavour.

White chocolate, a must for pastry chefs

White chocolate is often less appreciated because it seems to be a more neutral chocolate. Its white colour is due to the fact that it contains no dry cocoa, which distinguishes it from other types of chocolate. It is ideal for pastries because of its neutral taste, which goes well with red fruits such as lemon, vanilla or coconut.

White chocolate is made up of :

At least 20% cocoa butter
About 60% sugar
At least 14% of milk

Cocoa butter is generally deodorised before being used to make chocolate.

In pastry-making, white chocolate is a precious ally. Cocoa butter captures flavours and can be used in a variety of flavours. It is widely used to make the insides of macaroons.

Blond chocolate

Pastry chef Frédéric Bau created blond chocolate, also known as ‘Dulcey’ chocolate because of its golden colour. According to the story, after melting white chocolate in a bain-marie, he forgot to turn off the heat. The chocolate was left to cook in this way for fifteen hours. The recipe has been refined since this discovery. To create Dulcey chocolate, the chef gently mixes cocoa beans with sugar and milk and cooks the mixture at a temperature of between 93 and 135 degrees Celsius.

Filled chocolate, tasty and delicious

Filled chocolate is a distinct type of chocolate because it is made from different types of chocolate, such as dark, white or milk. Filled chocolate is a type of chocolate with a chocolate exterior. This outer part can be made with any type of chocolate. To qualify as filled chocolate, the chocolate must represent at least 25% of the total weight of the product. When it comes to fillings, there is a wide variety to choose from: liqueur, ganache, candied fruit, dried fruit, marzipan, etc.

Eating chocolate

Chocolate can be eaten in a variety of ways: in bars, in sweets, simply as a snack, in powder form or as butter. For example, when cocoa powder is mixed with sugar, it becomes chocolate powder, which is often used to make hot drinks. Cocoa butter is used in cooking to add fondant, shine and fluidity to chocolate, among other functions. Once crystallised, it is also responsible for the brittleness and crunchiness of a bar. Finally, when it comes to tasting, it’s intriguing to know that chocolate can be enjoyed in combination with other foods. Chocolate can be stored at temperatures below 18 degrees Celsius and is delicious at 20 to 22 degrees Celsius.

Why should I be interested in this post?

This post could help people to make informed consumer choices and to promote the diversity and quality of chocolate.

▶ Mathis DIALLO The environmental impact of cocoa

▶ Mathis DIALLO The cocoa production

▶ Mathis DIALLO The price of cocoa

▶ Mathis DIALLO The Armarajo hedge fund’s corner in the cocoa market in 2010

Useful resources

Recettes de chez Fauchon, entreprise mondiale de gastronomie de luxe

About the author

The article was written in July 2024 by Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026).

The Armarajo hedge fund’s corner in the cocoa market in 2010

January 27, 2026July 10, 2024 by Mathis DIALLO

In this article, Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026) explains the story of the hedge fund’s corner in the cocoa market created by Anthony Ward in the 2010’s, and its repercussions.

Speculative funds can sometimes fuel price rises, with the last financial crisis prompting hedge funds to position themselves on the commodities markets. The cocoa side of famour markets such as the NYSE or the City is even more susceptible to speculation. Whether there is a shortage or a surplus, speculation is based on the actual form of the market but exaggerates the trends.

Anthony Ward
Logo of Angie
Source: The Guardian.

The financial operation of the British hedge fund Armajaro

In this way, it is easy to understand that speculation on commodities can reach excessive proportions that could have harmful repercussions on the market. The latest example of this is the purchase in 2010 by the British hedge fund Armajaro of almost 240,100 tonnes of cocoa on the London market of NYSE Liffe. This is equivalent to 7% of world production, or 15% of global stocks.

The aim of this manoeuvre was to dry up the world cocoa market and reduce the supply of cocoa beans in order to drive up cocoa prices, much to the chagrin of chocolate consumers. This action was to take on its full meaning when set against the fall in supply from the world’s two largest cocoa producers, Ghana and Côte d’Ivoire, as well as increased consumption from the emerging countries.

But buying up almost all European stocks in one fell swoop was bound to have consequences, and the action alone caused prices to soar. In fact, shortly after the hedge fund’s operation, the market price per tonne rose to £2,725 (in 2010, equivalent to €3,247), the highest level since 1977, according to Business Insider.

By way of comparison, all those tonnes of cocoa would fill around 160 Olympic-size swimming pools with chocolate beans, which is obviously an aberration.

Faced with these unprecedented dynamics, it was hardly surprising that small manufacturers feared that Armajaro, with its huge stock, would set prices as it saw fit. A week after this financial coup, they launched a petition denouncing price manipulation by the trader.

The high-risk corner strategy

This strategy, which aims to attack the market head-on, is known as the ‘corner strategy’. This was not Anthony Ward’s first attempt at such a strategy. Less than a decade earlier, in 2002, he had already undertaken the same type of action on the commodities market, making huge profits in the process. At the time, however, the banks had no hesitation whatsoever in financing its activities. On the contrary, they financed these activities with complacency, a symbol of a particularly marked affairism at the time, showing the role of speculation within the commodities market.

However, these operations do not always produce winners, precisely because they are risky enough and the promise of future profits is not always there. This is somewhat the case here. In fact, the poor performance of the agricultural commodities market – and therefore of cocoa at the same time – initially made the fund heavily loss-making. Then, over the years, prompted by cases of manipulation of certain prices (aluminium in particular), new regulations were introduced by financial bodies to ensure greater transparency in transactions linked to the purchase of raw materials.

It was against a backdrop of intensifying regulation of this market, and also pushed into a corner by certain non-governmental organisations seeking to stand in the way of these speculators, that the man known as the Chocolate Finger finally withdrew his trading activity from this market just three years later in 2013. Eventually, the trader got rid of his cocoa, coffee and sugar trading arm.

Divesting his cocoa, coffee and sugar trading arm was a major turning point for him at the time, as three years earlier he was extolling the virtues of commodities trading. Since then, this activity has become Armajaro’s ball and chain, with a net loss of 10.3 million dollars in 2012 compared with profits of 24.3 a year earlier. That was the end of the empire.

Why should I be interested in this post?

Is is interesting because the massive purchase of cocoa by the Armajaro fund in 2010 has caused prices to soar, illustrating very well the impact of some speculative strategies on commodity markets and sparking debate on financial regulation. It has also affected a lot producers‘incomes and consumers’ costs.

▶ Mathis DIALLO The environmental impact of cocoa

▶ Mathis DIALLO The cocoa production

▶ Mathis DIALLO The price of cocoa

▶ Mathis DIALLO Different types of chocolate

Useful resources

Quite interesting article from the New-York Times in 2010, explaining the links between this operation and the fact that prices went up at this time:

New York Times Trader’s Cocoa Binge Wraps Up Chocolate Market

Very good article from the French newspaper Le Monde, which deals about the successes and the bad aspects of that kind of operation:

Marc Roche (12/11/2013) Le plus célèbre spéculateur du cacao rend son tablier Le Monde.

About the author

The article was written in July 2024 by Mathis DIALLO (ESSEC Business School, Grande Ecole Program – Master in Management, 2023-2026).

Exploring the SARR Fund: A New Approach to Innovative Corporate Financing

April 20, 2026July 9, 2024 by Gilles de MALBOSC

In this article, Gilles de MALBOSC (Manager of the SARR fund and CIO at Harmony Family Office) explores a new approach to innovative corporate financing : the Stable and Recurring Revenue (SARR) Fund.

Exploring the SARR Fund: A New Approach to Innovative Financing

In the ever-evolving landscape of financial investments, the SARR Fund stands out as a pioneering solution for growing enterprises. This fund is designed to provide innovative financing options that cater to companies with stable and recurring revenue models. Here’s a closer look at what makes SARR Fund a unique investment opportunity.

Introduction to SARR Fund

SARR stands for Stable and Recurring Revenue. The SARR Fund is a private fund that aims to invest a minimum of 95% of its total assets in private subscription investments. Unlike traditional investment vehicles, SARR focuses on purchasing future revenues from companies, offering them a financing method that doesn’t rely on real estate or personal guarantees. This approach allows companies to secure funding quickly, without diluting ownership or adversely affecting their debt ratios.

Why SARR Fund?

SARR both finances real-life growing companies in an entrepreneur friendly fashion, and it leverages technology like no other fund :

Innovative Financing Solutions

SARR helps entrepreneurs.

Quick Financing: Companies can receive financing within 48 hours, which is crucial for businesses needing rapid capital to seize growth opportunities.
Non-Dilutive Capital: By selling future revenues instead of equity, companies retain full control over their operations. For entrepreneurs, it’s like being granted some debt, in 48 hours, and without impacting their debt-ratio
Data-Driven Decisions: Financing decisions are based purely on data, ensuring fairness and transparency regardless of the entrepreneur’s background. Because SARR relies on “clean” data since it’s provided by trusted third parties

Timing and Technology

The fund leverages two modern concepts to provide its innovative solutions:

Open Banking: This technology gives investors comprehensive insights into companies’ financial health, enhancing the accuracy of risk assessments. This allows them to make decisions based on data that comes directly from 3 trusted third parties: the bank, the accountant and the subscription manager
XaaS Model: Companies operating on a subscription-based model offer predictable and stable revenue streams, making them ideal candidates for the fund.

How Does SARR Fund Work?

A typical transaction involves a company, such as a growing CRM software provider, seeking additional funding to expand its product offerings. The step-by-step process is described below:

Marketplace Registration: The company registers on a fintech marketplace, which evaluates their financial data to determine a trading limit and risk profile.
Funding Request: The company submits a funding request based on their trading limit.
Revenue Sale: SARR Fund purchases a portion of the company’s future recurring revenue at a discount, providing the necessary capital upfront.
Revenue Collection: The fund collects the full value of the purchased revenue in monthly installments over the next 12 months.

Process of a transaction.

Source: The company.

Benefits for Investors

Investing in the SARR fund presents the following Benefits for Investors: Low Risk and High Stability, Performance and Security.

Low Risk and High Stability

Senior Repayment Position: SARR Fund is positioned ahead of most senior lenders, reducing the risk of default.
Diversification: The fund invests in more than 100 companies, ensuring that no single investment exceeds 2% of the total Asset under Management (AUM).
Monthly Liquidity: Investors have access to 7.5% of the fund’s total AUM each month, providing a level of liquidity uncommon in similar investment vehicles.

Performance and Security

Collateral: Investments are secured by collateral from the outset, and covenants are in place to protect the principal.
Consistent Returns: The fund aims for positive performance each month, leveraging the stability of recurring revenue models.

Target Audience

The SARR Fund is suitable for a wide range of investors, including company treasurers, family offices, business angels, financial advisors, and high net worth individuals. Its structure and risk management strategies make it appealing even to conservative investors seeking stable returns with low volatility.

Conclusion

The SARR Fund represents a significant innovation in the field of private equity and venture financing. By focusing on stable and recurring revenue streams, it offers a low-risk, high-stability investment option that benefits both investors and growing enterprises. This unique approach not only provides quick and non-dilutive financing but also ensures robust returns for investors through meticulous data-driven decision-making and strategic partnerships with leading fintech platforms.

For more detailed information on the SARR Fund, prospective investors are encouraged to review the fund’s prospectus and consult with financial advisors to understand the full scope of benefits and risks associated with this innovative investment vehicle.

Useful resources

The Future of Data-Driven Finance and RegTech: Lessons from EU Big Bang II European Banking Institute Working Paper Series 2019/35

From FinTech to TechFin: The Regulatory Challenges of Data-Driven Finance

New York University Journal of Law and Business, Forthcoming European Banking Institute Working Paper Series 2017 – No. 6

Risk-based Investment Management in Practice (Global Financial Markets), by Frances Cowell

Banks and the real economy: An assessment of the research, Allen N. Berger, Phil Molyneux, John O.S. Wilson

About the author

The article was written in July 2024 by Gilles de MALBOSC (Manager of the SARR fund and CIO at Harmony Family Office).

Top 5 Private Equity firms in Germany

January 27, 2026July 9, 2024 by Margaux DEVERGNE

In this article, Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024) presents the top 5 Private Equity Firms in Germany.

Introduction

Germany is home to some of the largest and most influential private equity firms in Europe. These firms manage billions of euros in assets and invest in high-growth potential companies through buyouts, growth financing, and turnarounds. Key players in the German private equity landscape include international heavyweights such as Permira, Cinven, and EQT, alongside German-origin firms like Triton and Advent International. With strategically located offices in cities such as Frankfurt, Munich, and Berlin, these firms are well-positioned to identify and finance premier investment opportunities in one of Europe’s most dynamic and innovative markets.

Methodology

To define the top five private equity firms in Germany, several criteria and financial metrics are typically considered: Assets Under Management, Transaction Volume. Investment Profitability, Geographical Presence, Investment Sectors, Tenure and Reputation, and Recent Fundraising

Assets Under Management (AUM)

One of the primary criteria for evaluating the significance of a private equity firm is the size of its assets under management. AUM represents the total capital managed by the firm across its various investment funds. Higher AUM indicates greater capacity for making substantial investments.

Transaction Volume

The total volume of acquisition deals conducted by a private equity firm over a given period (typically the past 3-5 years) is a good indicator of its activity and market presence in Germany. Large-scale transactions, or mega-deals, are particularly scrutinized.

Investment Profitability

The financial performance of the funds managed by the firm is analyzed, focusing on internal rates of return (IRR) and multiples of invested capital. Firms demonstrating high IRRs on past investments are more highly valued.

Geographical Presence

A strong local presence in Germany, with offices in major cities such as Frankfurt, Munich, or Berlin, is advantageous for capitalizing on domestic investment opportunities.

Investment Sectors

Private equity firms specializing in key sectors of the German economy, such as industry, financial services, healthcare, or technology, receive higher ratings.

Tenure and Reputation

The experience, longevity, and established reputation of a private equity firm in the German market play a significant role in its ranking.

Recent Fundraising

The amount of recent funds raised by the firm, reflecting the confidence of institutional investors, is also considered.

By cross-referencing these quantitative and qualitative metrics, analysts and specialized media compile rankings of the leading private equity firms active in Germany. Although subjective, these rankings provide a comprehensive overview of the landscape and major players in the sector.

How did I get these ranking results?

To establish a ranking of the top 5 private equity firms in Germany (Permira, Cinven, EQT, Triton and Advent International), the most important criteria used were as follows:

Assets under management (AUM): EQT appears to have a dry powder of €25.28 billion, which puts it in the lead for this criterion.

Transaction volume: Triton is listed in the top 3 most active companies in Germany according to Private Equity Monitor, which suggests that its transaction volume is high.

Investment sectors: EQT stands out as having strong expertise in technology sectors, which may be an advantage given the importance of the TMT sector in Germany.

From this we obtained the 5 firms to rank:

Permira
Cinven
EQT
Triton
Advent International

To compile the ranking, we will analyze each firm using the metrics mentioned above.

Permira

Assets Under Management: Approximately €32 billion
Notable Recent Transactions: Acquisition of Siemens Logistics in 2020 (€1.1 billion), buyout of Camfil in 2022 (€4.8 billion)
Profitability: Net IRR of 22.5% on mature funds
Presence: Offices in Frankfurt, Munich, and other German cities
Key Sectors: Technology, services, consumer goods
Established: 1985

Logo of the company.
Logo of Permira
Source: The company.

Cinven

Assets Under Management: Over €30 billion
Transactions: Acquisition of Compressors Systems in 2022 (€3.9 billion)
Profitability: Gross IRR of 27% on European funds
Presence: Offices in Frankfurt and Munich
Sectors: Business services, healthcare, technology
Established: 1977

Logo of the company.
Logo of Cinven
Source: The company.

EQT

Assets Under Management: €84 billion
Transactions: Buyout of Freenet in 2022 (€1.3 billion)
Profitability: Net IRR of 24% on private equity funds
Presence: Offices in Munich, Frankfurt, and other cities
Sectors: Technology, healthcare, services, industry
Established: 1994

Logo of the company.
Logo of EQT
Source: The company.

Triton

Assets Under Management: €18.5 billion
Transactions: Acquisition of Flender in 2021 (€1.9 billion)
Profitability: Gross IRR of 32% on mature funds
Presence: Headquarters in Frankfurt, offices in Munich
Sectors: Industrial, services, consumer, healthcare
Established: 1997

Logo of the company.
Logo of Triton
Source: The company.

Advent International

Assets Under Management: $88 billion (approximately €80 billion)
Transactions: Buyout of Obier in 2022 (€1.1 billion)
Profitability: Net IRR of 22% on mature funds
Presence: Offices in Frankfurt and Munich
Sectors: Financial services, healthcare, industry, retail
Established: 1984

Logo of the company.
Logo of Advent International
Source: The company.

Conclusion

The private equity landscape in Germany is dominated by a few major players, comprising both leading international firms and well-established German companies. At the forefront of this ranking is Permira, with approximately €32 billion in assets under management, closely followed by Cinven, managing over €30 billion. The Swedish giant EQT ranks third with an impressive portfolio of €84 billion in assets.

German firm Triton, with €18.5 billion under management, and the American firm Advent International, boasting $88 billion (approximately €80 billion) in assets, round out the top five. These substantial figures underscore the financial strength of these firms, enabling them to execute significant transactions, such as EQT’s recent acquisition of Freenet for €1.3 billion.

Beyond the size of the assets managed, these private equity firms also demonstrate remarkable performance, with net internal rates of return (IRR) ranging from 22% to 32% on their mature funds. This high profitability ensures the confidence of institutional investors, allowing these firms to continue raising substantial funds and maintaining their status as key players in the German market for acquisitions and growth financing.

Why should I be interested in this post?

As a French-German ESSEC student enrolled in the SimTrade course, exploring the realm of private equity could be highly beneficial. This post offers an insightful examination of the key players in the German industry, providing valuable insights into their distinctive characteristics. It presents an opportunity to deepen your understanding of the sector and potentially identify your future employer among these influential firms.

Useful resources

Permira Company

Cinven Company

EQT Group Company

Triton Partners Company

Advent International Company

About the author

The article was written in July 2024 by Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024).

My experience as a junior consultant in a communications agency

July 10, 2024July 9, 2024 by Margaux DEVERGNE

My experience as a junior consultant in a communications agency

In this article, Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024) shares her professional experience as a trainee in Angie, a communications agency in Paris (May-August 2021).

About the company

Angie is a distinguished French communications and influence agency based in Paris, recognized for its comprehensive and innovative approach to brand communications.

Founded in 1988, Angie initially started as a press relations agency. Over the years, it has expanded its scope to provide a broad range of communications strategies and support for brands across various industries. This evolution reflects Angie’s commitment to adapting to the changing landscape of communications and influence.

Angie positions itself as a “co-influence and engagement” agency, offering an extensive array of services. These services encompass media relations, crisis management, public affairs, social media, influencer marketing, and data intelligence. Additionally, Angie excels in editorial services, including content creation, storytelling, website content, and reporting. The agency also specializes in internal communications, conducting audits, managing transformations, and producing internal magazines and newsletters. Furthermore, Angie offers expertise in corporate social responsibility (CSR) communications and business to business (B-to-B) marketing, providing content marketing, thought leadership, loyalty programs, and social selling. Their capabilities in user experience (UX) and technology, including search engine optimization (SEO) and website/app development, further enhance their service offerings.

With a team of around 60 employees (in 2020), Angie adopts an integrated approach that covers strategy, creative services, production, and execution across multiple channels (LinkedIn, Twitter, Instagram, newsletters, etc.). Angie adopts an integrated approach that covers strategy, creative services, production, and execution across multiple channels to ensure a coherent and effective campaign. This holistic methodology ensures that clients receive tailored and effective communication solutions.

Angie boasts a diverse portfolio of clients from various sectors. Well-known clients include La Poste, the French postal service, and Pôle Emploi, the French employment agency. This diverse clientele underscores Angie’s ability to cater to different industries and their unique communication needs.

As an independent communications group headquartered in Paris, Angie has expanded its capabilities by establishing subsidiaries such as Angie Edition, Angie Interactive, and 35 Mai Productions. These subsidiaries enable Angie to offer in-house content creation and production services, further solidifying its position in the market.

Although specific financial figures are not publicly available, Angie’s reputation in the French communications industry speaks volumes. The company is known for its innovative and integrated approach to brand communications and influence, establishing itself as a reputable player in the industry.

Logo of the company.
Logo of Angie
Source: Angie.

My internship

As a junior consultant trainee at Angie, I have been fully immersed in a dynamic and creative environment at the core of multidisciplinary teams. Each day, I collaborate with strategists, creatives, digital experts, and press relations officers to develop innovative 360° communication strategies for high-profile clients. My responsibilities include content curation, social media posting, weekly monitoring, newsletter writing, and performance analysis (a systematic approach used to evaluate the effectiveness and efficiency of various processes, projects, or systems within an organization). I conduct in-depth market research, analyzing online trends and conversations to uncover relevant marketing insights. Additionally, I actively contribute to the design of impactful marketing campaigns by proposing creative concepts and producing compelling editorial c (for instance newsletters, monitoring, etc…).

This internship provided me with the opportunity to develop cutting-edge expertise in the fields of influence, digital marketing, and public relations. I am gaining insights into the latest crisis management and brand communication techniques (brand messaging, visual identity, social media engagement, public relations…). Most importantly, I benefit from the personalized support of experienced consultants who generously share their expertise. Their sound advice and considerate mentoring guide me through my training at this prestigious agency. Each day presents a new opportunity to learn, grow professionally, and prepare for future challenges in this exciting sector.

My missions

As a junior consultant intern at Angie, my mission involves engaging with major business to business (B-to-B) and business to consumer (B-to-C) accounts in the luxury, lifestyle, care, and travel sectors. My responsibilities include curating high-quality content and writing tweets and LinkedIn posts for prominent companies. I am also learning to navigate and utilize the Sprinklr platform (a comprehensive customer experience management (CXM) platform designed to help businesses manage their social media presence, marketing, advertising, research, and customer service across various digital channels) effectively. Additionally, I am strengthening my skills in using X (Twitter), LinkedIn, and Canva to enhance digital communication strategies for our clients. This role allows me to contribute to the development of impactful social media content while gaining valuable experience in digital marketing and client engagement.

Required skills and knowledge

In my dynamic role as a Junior Consultant at Angie, I quickly realized the extensive range of responsibilities and the continuously evolving skill set required. Central to my role was mastering the art of communication, both written and oral. Whether crafting newsletters, coordinating with media personnel, or pitching new ideas, my goal was always to achieve clarity and resonance with the audience. It was crucial to adapt my tone and style to fit the specific audience and occasion. For example, my main clients were Orpea (a nursing home organisation) and Accor (the hotel group). Their presence on social networks is not at all the same, and neither is the target audience. For Orpea, I had to speak in such a way that families potentially interested in the services offered by Orpea could understand and appreciate the messages transmitted through the posts. On the other hand, the Accord group gave us a lot more flexibility when it came to the visual identity of the posts on social networks, because the target audience is generally young, dynamic and travel-loving.

Effective communication was not just about creating the message; it also involved measuring its impact. Here, data analytics became an invaluable tool. Metrics such as engagement rates and conversion rates provided insights into the effectiveness of our campaigns and identified areas for improvement. As the digital landscape expanded, I deepened my proficiency with tools like Sprinklr to enhance the companies’ visibility in the vast online environment.

A critical aspect of my role was crisis management. While not every day presented challenges, being prepared for them was essential. Specialized workshops in crisis communication equipped me with the knowledge and strategies to handle issues effectively, ensuring the companies’ reputations remained intact. Crisis communication is a critical aspect of public relations and organizational management that involves the strategies and practices used to manage the dissemination of information during a crisis. Effective crisis communication aims to protect and maintain an organization’s reputation, mitigate the impact of the crisis, and ensure transparent and accurate information flow to stakeholders. Key elements of crisis communication include preparedness, rapid response, consistent messaging, and empathy. By having a well-defined crisis communication plan, organizations can navigate crises more effectively, minimizing potential damage and maintaining public trust.

Understanding the essence of the concerned brands enabled me to create cohesive narratives across all communication platforms, fostering consistency and a deeper connection with the audience. The communications field is vast, with each project having its own timelines and nuances. Efficiently organizing, prioritizing, and monitoring tasks became second nature, facilitated by tools and platforms that ensured timely delivery and kept stakeholders informed.

Visual storytelling, a key component of modern communication, often involved close collaboration with graphic designers. A foundational understanding of design tools ensured that our visual campaigns aligned seamlessly with our narratives. Regular participation in industry events kept me connected and informed about the latest trends.

This journey was more than just a job; it was a continuous learning experience, keeping me up to date with best practices and evolving trends in corporate communication.

What I learned

As a junior consultant intern at Angie, a leading French communications agency, I gained invaluable hands-on experience and insights into the dynamic world of integrated marketing communications.

Strategic Planning and Execution:

I had the opportunity to participate in developing comprehensive communication strategies for high-profile clients across various industries. This involved conducting market research, analyzing consumer trends and online conversations, and translating insights into actionable plans. I learned how to craft compelling narratives, position brands effectively, and execute multi-channel campaigns seamlessly.

Content Creation and Storytelling:

Content is at the heart of modern marketing, and at Angie, I honed my skills in creating engaging content tailored for different platforms and audiences. From crafting compelling social media posts and website copy to developing thought leadership articles and multimedia assets, I learned the art of storytelling and how to captivate audiences through creative and informative content.

Digital Marketing and Analytics:

Angie’s expertise in digital marketing allowed me to gain hands-on experience with various tools and techniques. I learned about search engine optimization (SEO), pay-per-click (PPC) advertising, social media marketing, and influencer collaborations. Additionally, I developed skills in data analysis, interpreting metrics, and using insights to optimize campaigns for better performance.

Media Relations and Crisis Management:

As an integrated communications agency, Angie handles media relations and crisis management for its clients. I had the chance to observe and assist in developing press releases, organizing media events, and managing crisis situations. This experience taught me the importance of effective communication, reputation management, and maintaining a positive brand image.

Collaboration and Teamwork:

Working alongside experienced strategists, creatives, digital experts, and public relations professionals, I witnessed the power of collaboration and teamwork. I learned how to contribute effectively in a cross-functional environment, communicate ideas clearly, and leverage the diverse expertise of team members to deliver exceptional results for clients.

Overall, my internship at Angie provided me with a comprehensive understanding of the communications industry, from strategy development to execution across multiple channels. The practical experience, mentorship, and exposure to real-world projects have equipped me with valuable skills and a solid foundation for a successful career in this dynamic field.

Financial concepts related my internship

Budgeting and Cost Management

One of the critical aspects of executing successful marketing campaigns is effective budgeting and cost management. During my internship, I learned how to develop comprehensive campaign budgets, allocating resources across different channels and activities, such as content creation, media placements, influencer collaborations, and event management.

I worked closely with project managers and account executives to ensure that campaigns were delivered within the allocated budgets, while maximizing the return on investment (ROI) for clients. This involved analyzing cost estimates, negotiating with vendors, and identifying opportunities for cost optimization without compromising the campaign’s effectiveness.

Return on Marketing Investment (ROMI)

In the world of marketing and communications, it is essential to measure the effectiveness of campaigns and demonstrate their impact on business objectives. At Angie, I gained exposure to various metrics and analytical tools used to calculate the return on marketing investment (ROMI).

This concept involves evaluating the revenue generated or other business outcomes achieved because of a marketing campaign and comparing it to the total investment made in that campaign. By analyzing ROMI, clients can assess the profitability and overall success of their marketing efforts, enabling data-driven decision-making for future campaigns. During my internship, I assisted in collecting and analyzing data related to campaign performance, such as website traffic, lead generation, sales conversions, and brand awareness metrics. This data was then used to calculate ROMI and provide insights to clients on the effectiveness of their marketing strategies.

Client Profitability Analysis

As a consulting agency, Angie’s success is closely tied to the profitability of its client engagements. During my internship, I learned about the importance of client profitability analysis, which involves evaluating the revenue generated from each client against the costs associated with servicing that client.

This analysis considers various factors, such as billable hours, resource allocation, project complexity, and overhead costs. By understanding the profitability of each client relationship, the agency can make informed decisions about pricing strategies, resource allocation, and client portfolio management.

I had the opportunity to assist in compiling data and conducting profitability analyses for various client accounts. This involved tracking project expenses, monitoring resource utilization, and identifying areas for efficiency improvements or potential scope creep that could impact profitability.

By understanding these financial concepts and their application in the communications industry, I gained valuable insights into the business aspects of marketing and communications campaigns. This knowledge will be invaluable as I continue to pursue a career in this dynamic field, enabling me to contribute to the financial success of future client engagements and agency operations.

Why should I be interested in this post?

If the world of communication within the largest French companies interests you, this post is for you! Through this experience, I realized that a significant amount of work is outsourced to specialists in the field. Combining communication, marketing, and finance primarily revolves around budget allocation and return on investment (ROI). Marketing teams must justify their expenditures by demonstrating the financial impact of their campaigns on sales, market share, or brand valuation. Calculating marketing ROI allows for assessing the profitability of investments and optimizing budget allocation.

Useful resources

Angie website

Berlo, D. K. (1960). The Process of Communication: An Introduction to Theory and Practice. New York: Holt, Rinehart and Winston.

Entreprise et medias (l’Association des Directeurs et Directrices de la Communication).

Coombs, W. T. (2015). Ongoing Crisis Communication: Planning, Managing, and Responding (4th ed.). Thousand Oaks, CA: SAGE Publications.

About the author

The article was written in July 2024 by Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024).

My experience as an apprentice student in internal audit at Atos SE, during the split of the company

December 6, 2025July 9, 2024 by Margaux DEVERGNE

In this article, Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024) shares her professional experience as a part-time student in internal audit at Atos SE, from September 2022 to December 2024.

About the company

Atos SE is a global leader in digital transformation with a rich history dating back to its founding in 1997. The company emerged from a series of mergers and acquisitions, including the merger of Axime and Sligos, which formed Atos Origin. Over the years, Atos has continued to expand its footprint through strategic acquisitions, such as the purchase of Siemens IT Solutions and Services in 2011 and the more recent acquisition of Syntel in 2018. These moves have positioned Atos as a key player in the IT services and consulting market.

Atos offers a diverse portfolio of products and services, including cloud computing, cybersecurity, high-performance computing, and digital workplace solutions. The company is also known for its contributions to the fields of big data and artificial intelligence. Atos serves a wide range of industries, including healthcare, financial services, manufacturing, and public sector organizations, providing tailored solutions to meet the specific needs of its clients.

In terms of financial performance, Atos has demonstrated steady growth. For the fiscal year 2023, Atos reported revenues of approximately €11 billion. The company’s digital, cloud, and cybersecurity services have been key drivers of this revenue. Despite facing challenges in some segments, Atos has continued to invest in innovation and expand its service offerings to capture new market opportunities.

Atos’ share price has experienced fluctuations over the years, reflecting broader market trends and company-specific developments. As of mid-2024, the share price is under pressure due to restructuring efforts and market conditions, trading around €6 per share. The company is actively working on strategic initiatives to streamline operations and enhance profitability, which could positively impact its stock performance in the future.

After a long battle with Czech billionaire Daniel Kretinsky, David Layani, founder of IT company OnePoint, has finally won the battle to take over Atos SE. The Atos Board of Directors chose Layani’s offer, supported by some of the creditors, which provides for €2.9 billion of existing Atos debt to be converted into equity, making the creditors the main shareholders with around 79% of the capital. Onepoint, Butler and Econocom will inject €175 million to take a 21% stake, while €1.5 billion of new debt will be made available to relaunch Atos’ activities. This major financial restructuring will enable Atos to get back on track after months of difficulties.

Overall, Atos SE stands out as a significant player in the global IT services market, with a strong focus on digital transformation, cloud, and cybersecurity solutions. The company’s commitment to innovation and strategic growth positions it well for future opportunities, despite current challenges.

Logo of the company.
Logo of Atos SE
Source: The company.

My Apprenticeship

Internal Audit at Atos SE plays a crucial role in continuous process improvement and risk management. This independent and objective service aims to assess and improve the effectiveness of the company’s operations, internal controls and governance. Internal auditors examine financial, operational and IT systems to ensure compliance with applicable standards and regulations. By identifying weaknesses and proposing constructive recommendations, internal audit helps to strengthen the company’s overall performance and ensure the reliability and transparency of financial reporting.

My missions

Within the Internal Audit Group, in an international and evolving context, the missions of the student in Internal Audit are based on 3 axes under the supervision of the Group’s internal control manager:

Participate in activities to strengthen internal control for all the Group’s support functions and operations, i.e.
Participate in the strategic risk management process of the company
Preparation (risk mapping) and participation in risk assessment workshops within the management committee of the geographical units.
Consolidation of results.
Assist in the deployment and strengthening of the internal control system, through initiatives such as:
Maintenance and improvement of the control framework
Participation in the Control Testing campaign to assess the maturity of internal control throughout the Group.

Required skills and knowledge

I work in a very international team, whose members were based in France, Portugal, Sweden and India. In terms of soft skills, the interpersonal aspect is crucial, because in auditing we must work with a huge number of departments to obtain the information we’re looking for. In addition, as part of a very international team, the working language is English, not French, which also requires an open mind due to the mix of different cultures. Good communication skills are essential, as is attention to detail and adaptability.

In terms of hard skills, you need to have a good command of Excel, the principles of Environmental, Social, Governance (ESG), the fundamentals of internal control, risk management and audit tools, which are specific to each company.

During my apprenticeship, I started to learn how PowerBI works (it’s a suite of data analysis and visualization tools developed by Microsoft. It enables users to connect, transform, visualize and share data interactively), which is also one of the most widely used tools for analyzing the progress of audits in real time.

What I learned

Internal audit has given me an in-depth understanding of organizational dynamics and internal control mechanisms. By systematically assessing operational processes, I have developed my knowledge of how to identify inefficiencies and risks inherent in the company’s activities. I have also strengthened my communication skills, learning to clearly articulate the conclusions and recommendations of audits to stakeholders. Exposure to various audit techniques, such as data analysis and tests of control, has enabled me to acquire analytical rigor and problem-solving skills. This experience has also improved my adaptability, enabling me to adjust effectively to the specific requirements of each assignment. Finally, an in-depth knowledge of professional standards and regulations has been essential in ensuring operational compliance and promoting a culture of continuous improvement within the organization.

Financial concepts related to my apprenticeship

Internal Controls

Internal controls are the policies, procedures, and mechanisms put in place by an organization to ensure the integrity of financial reporting, operational effectiveness, and compliance with applicable laws and regulations. As an internal audit intern at Atos SE, one of my primary responsibilities is to evaluate the design and operational effectiveness of the company’s internal control framework across various business processes and functions.

By assessing internal controls, I would help identify potential weaknesses or deficiencies that could expose the company to risks such as financial misstatements, fraud, or operational inefficiencies. This evaluation would involve testing key controls, reviewing documentation, and conducting interviews with process owners to understand the control environment.

Risk Assessment

Risk assessment is a critical component of internal auditing, as it helps identify and prioritize the areas that pose the greatest risks to the organization. At Atos SE, I’m involved in the risk assessment process, which typically involves:

Understanding the company’s risk universe and the potential impact of various risks on its operations and financial performance.
Analyzing risk factors such as changes in the regulatory environment, technological advancements, cybersecurity threats, and market conditions.
Evaluating the adequacy of existing risk management strategies and controls.
Providing recommendations for enhancing risk management practices and mitigating identified risks.

By conducting risk assessments, it contributes to the development of an effective risk-based internal audit plan, ensuring that audit resources are allocated to the areas of highest risk.

Compliance

Compliance with applicable laws, regulations, and internal policies is a crucial aspect of corporate governance and risk management. In the internal audit team, we are responsible for assessing the company’s compliance with various regulatory requirements, such as data privacy laws (e.g., GDPR), anti-corruption laws, and industry-specific regulations.

This involves reviewing the company’s compliance policies and procedures, testing the effectiveness of compliance controls, and identifying potential areas of non-compliance. Auditors are also expected to provide recommendations for strengthening the compliance program and addressing any identified deficiencies.

By ensuring compliance, the audit team help Atos SE mitigate legal and reputational risks, avoid potential fines and penalties, and maintain a strong ethical culture within the organization.

Why should I be interested in this post?

If you are currently employed at one of the Big Four accounting firms and are considering a transition to internal audit, a concise summary of my experience as a work-study student at a company specializing in cybersecurity may offer you a valuable perspective.

The primary objective of this post is to provide a clearer understanding of internal auditing from the standpoint of a work-study student who began with no prior knowledge of the field.

For those with an interest in finance, engaging in this sector through internal audit can serve as an excellent introduction. It can also pave the way for future opportunities in consultancy firms or act as a steppingstone towards roles that demand a higher level of precision, whether in internal or external audit.

Useful resources

Atos SE website

Atos SE career website

The Institue of Internal Auditors

Institut Français de l’Audit et du Contrôle Interne

Certified Internal Auditor certification

About the author

The article was written in July 2024 by Margaux DEVERGNE (ESSEC Business School, Global BBA, 2020-2024).

Historical context and background

Key features

Scrypt Algorithm

Faster Block Time

Higher Maximum Coin Supply

Segregated Witness (SegWit) Activation

Atomic Swaps

Litecoin Improvement Proposals (LIPs)

Use cases

Peer-to-Peer Payments

Online Purchases

Micropayments

Cross-Border Transactions

Privacy Transactions

Technology and underlying blockchain

Supply of coins

Historical data for Litecoin

How to get the data?

Historical data for the Litecoin market prices

R program

Data file

Python code

Evolution of the Litecoin

Statistical distribution of the Litecoin returns

Historical distribution

Gaussian distribution

Risk measures of the Litecoin returns

Why should I be interested in this post?

Related posts on the SimTrade blog

About cryptocurrencies

About statistics

Useful resources

Academic research about risk

Data

About the author

Investissements Durables : Le Nouveau Visage de la Finance

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L’essor de l’investissement durable

Les défis et les opportunités

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Ressources utiles

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Introduction

Les avantages du trading haute fréquence

Les défis et les risques

La réglementation et l’avenir du trading haute fréquence

Articles connexes sur le blog SimTrade

Ressources utiles

A propos de l’auteure

Introduction

Top Financial Innovations that Changed People’s Life in the 20th century

Credit Cards and Debit Cards

Automated Teller Machines (ATMs)

Telephone Banking

Online Banking

Conclusion

Why should I be interested in this post?

Related posts on the SimTrade blog

Useful resources

About the author

The Yield Curve

Introduction

The type of the yield curve

Treasury Bills (T-Bills)

Treasury Notes (T-Notes)

Treasury Bonds (T-Bonds)

Different types of yield curves

Normal Yield Curve

Inverted Yield Curve

Flat Yield Curve

Hump-Shaped Yield Curve

Reasons for different yield spreads

Importance of the Yield Curve

The Inverted Yield Curve

Common Indicators to Measure Yield Curve Inversion

Reasons for Inversion

Why should I be interested in this post?

Related posts on the SimTrade blog

Useful resources

Top Financial Innovations that Changed People’s Life in the 20^th century