La Libra, Facebook's digital currency, announced for 2021 in reduced format

The launch of Facebook's digital currency, Libra , could take place in 2021. The project may benefit from favorable factors in the global economy, but regulators will have to be convinced first.  Facebook could launch Libra, its digital currency in 2021, we learn from the British media Financial Times, which quotes people close to the process. The product is expected to arrive in a limited version, after the project has met with great aversion from regulators, including in the United States, the country where the headquarters of the social media management company are located. The stakeholder association behind this digital currency project is now planning to launch a single version of Libra that will itself be pegged to the dollar, at the rate of one unit of US currency for each Facebook digital currency . “The other forms of currencies will be deployed at a later stage,” the FT source added. The exact launch date will depend on when the project

The dividend is not a lifeline | Canada

Retail investors (and even some more sophisticated institutional investors) have always been attracted to dividend yields. The higher they are, the greater the appeal. This trend has been particularly exacerbated in a world where interest rates are very low and bonds yield almost nothing. But the value of a security has always been and will always be the present value of cash flow for the life of the business, not its dividend. There are many companies that create a lot of value by keeping their profits rather than paying them in dividends. That being said, the focus on dividends is understandable, as it is a simple metric. On the other hand, to estimate the value of a company, you have to take into account many factors, such as the dynamics of the industry up to specific problems of the company.

The dividend is not a lifeline

During this difficult time we are currently experiencing, many companies have announced that dividends will be cut or stopped altogether. Investors are realizing that focusing on dividends instead of other important factors in a company may not be the best idea. Let's take a look at an industry that has seen a general decrease in dividends.

With the Western Canadian Select now around $ 10 a barrel, many Canadian oil players have had to either reduce or completely cut their dividend. Some examples such as Crescent Point Energy, Inter Pipeline Ltd, WhiteCap Resources reduced their dividends by 75%, 72% and 50% respectively. While no one could have predicted what we are going through now, it was also impossible to have a high degree of confidence in the industry's biggest variable, the price of oil. Knowing that, should the dividend yield have been a primary objective when looking to invest in the oil sector? Probably not.

The holy grail of investing in dividend securities has always been Canadian banks. The five largest banks have paid dividends for more than a century, a record they most certainly intend to keep, as the CEO of CIBC reassured investors of their dividend in a recent interview. To protect themselves, retail investors should instead focus on different metrics such as leverage, underwriting and profitability, not just the dividend.

To conclude, we encourage investors to consider dividends as one of many variables in their analysis process during this period. You might get something that might not be there when the crisis is over.