Let’s preface this right. This is just a rumor. This is just a rumor.
Again! This is just a rumor. And I haven’t covered boxing full-time in years.
OK, now that we’ve got that out of the way. There are serious, serious whispers in Vegas that retired boxer Floyd Mayweather could sign a record-breaking $375M deal with CBS/Showtime.
“Floyd is super salty about that Canelo deal,” a source close to his management says. “He doesn’t like to be outdone in anything.”
Just last week, news broke that sports streaming DAZN had signed middleweight boxing champion Saul “Canelo” Alvarez to a $365M contract—reportedly the biggest guaranteed contract in all of sports.
With this deal, Canelo—who Mayweather fought and beat in September 2013—broke his 2013 record for richest contract in sports.
That deal guaranteed Mayweather $32M per fight for six fights. Canelo’s contract breaks down to just over $33M per fight, breaking Mayweather’s record for the richest deal.
Mayweather had already made headlines about coming back for a rematch against rival Manny Pacquiao, a 2015 fight that shattered every revenue record in sports history.
On the day of Canelo’s middleweight blockbuster with Gennady Golovkin last month, Mayweather released an Instagram video with Pacquiao claiming a fight was in the works for December. (That fight is now rumored for the spring.)
A fight with UFC lightweight champion Khabib Nurmagomedov—who just vanquished another Mayweather foe in McGregor—was also rumored, with Mayweather himself confirming another “nine-figure payday” in the works here.
“Oh, we’re fighting,” he told TMZ, saying he’d expect a guarantee of “$110 to $200M, guaranteed.”
According to the insider, Mayweather now wants a guaranteed contract of $125M per fight—$375M total—which would break Canelo’s record.
Mayweather made a record-breaking and record-tying $100M guarantee for his fights against Conor McGregor and Pacquiao.
The deal—crazy as it sounds—would include the winner of Pacquiao and Adrien Broner, a boxing rematch with McGregor and the Khabib matchup.
Should Mayweather get what he allegedly wants, he’d shatter his own record for highest guarantee per fight.
FWIW, after news of the Canelo deal hit, Mayweather came out with the verbal vitriol in an Instagram post, showcasing Floyd smacking Canelo with an uppercut.
“It takes me 36 mins or less to make $300 million plus. It literally takes me 1 night and 1 fight to make what you might make in 5 years and 11 fights! So really, who’s still winning? You do the math!”
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#TBT It didn’t matter if Canelo ate his PED steak or not this night, this was by far the easiest fight of my career! Connor McQuitter was a way better fighter than Canelo's cheating ass and I beat the brakes off him too! It takes me 36 mins or less to make $300 million plus. It literally takes me 1 night and 1 fight to make what you might make in 5 years and 11 fights! So really, who's still winning? You do the math!
Mayweather also had choice words for Canelo’s promoter Oscar De La Hoya, another past Mayweather foe…
With pay-per-view bonuses, Mayweather made a reported $300M for both the McGregor and Pacquiao fights. So he actually made more. Just not guaranteed.
Should this deal come to fruition, Mayweather would reclaim his throne as the PPV king. More as this story develops.
The Most Hyped Startup Is Now Worth $45B
Co-working rental startup WeWork has secured an additional $3B in funding from SoftBank, at a valuation worth nearly $45B. In a surprising move, SoftBank’s latest investment will more than double the startup’s valuation from the $20B figure it clinched during its last financing round.
The valuation will also drive a global co-working behemoth, bigger than Airbnb, PWC, SpaceX, or Ford Motor, making it the second most-valuable startup in the United States after Uber.
The capital injection comes at a time when WeWork’s losses are on a steady climb, recently ballooning to $2B on an annual basis. The investment from SoftBank, the startup’s largest investor, will also increase its cash pile and commitments to almost $6.4B.
Critics, however, claim that the valuation is highly inflated compared to other real estate players in the market, and remarked the startup might face an issue if their earnings fail to justify the excessive valuation.
Despite the possibility of headwinds in the short-term, WeWork’s vice-chairman Michael Gross was positive on the company’s long-term growth.
“Our view is that there is tremendous wind at our back — we are the only serious global player out there,” he said. “Our growth is actually accelerating as our product offering continues to go deeper and reach not just small-sized companies but Fortune 500 companies and everything in between.”
The Rise Of Algorithmic Trading: How Manned Trading Desks Are Seeing Their Demise
One of the last human points of resistance to the algorithmic take-over of professional trading can be found in the fixed-income trading desk.
The deft relationship business is known for having participants with Ivy League pedigrees and a lacrosse playing background, a data point that a machine learning algorithm recently used when making hiring recommendations.
With an algorithmic transition, profit margins are being squeezed as human relationships are becoming less important. Benchmarking the transition are new hiring mandates at some of the largest banks, a recent Greenwich Associates report pointed out.
Relationships and fundamental market understanding are less important, the report noted, and algorithmic experience and data science skills are now in demand.
In this emerging environment, what are best practices for an integration framework?
When combining fundamental investment thinking with quantitative thinking unique conflicts often arise. Fundamental, discretionary fund managers often creatively connect non-correlated dots and sometimes challenge consensus thinking.
Quantitative logic, on the other hand, is often driven by if-then Boolean logic at its core and looks for mathematical consensus to guide decisions. Mixing these two disciplines can be like expecting oil and water to enjoy each other’s company.
“Relationships and balance sheet still matter, of course,” Greenwich Associates Managing Director Kevin McPartland wrote in a report title that highlights a dichotomy, “Trust and Data Drive Fixed-Income Dealer Growth.”
Trust is a human concept and data is often associated with empirical, mathematically discovered understanding is the point where a melding of the minds might occur.
The integration of the two highlights the new path forward. “But the ability to manage both in a more quantitatively driven way can mean the difference between profit growth and a year-on-year decline,” McPartland observed.
Technology is increasingly becoming an important feature on bond trading desks, particularly for sell-side banks. Fully 91% of bulge bracket banks said automating parts of the trading process was one of their “top technology priorities for 2018,” the Greenwich Associates report pointed out.
Only 44% of middle market participants, meanwhile, felt the same. This group was having slightly more difficulty “complying with new/changing regulations” and was more focused on improving client management tools and data.
Knowing what technology to integrate so as to deliver a near-term positive return on investment while positioning the firm for a longer-term shift in intelligent automation can prove challenging and, itself, might have variables that don’t easily fit into a math formula.
“Assessing the process of tech integration is always a challenge because no technology is perfect, but it is often much better than human performance,” said Evan Schnidman, CEO and Co-Founder, Prattle, a firm that uses machine learning techniques to analyze human speech patterns to provide a market edge.
“Electronic equities trading has proven to be highly reliable, but very rare missteps can have catastrophic cascading effects. With bond trading, and any other technology-driven process in financial services, it is vital to build appropriate circuit breakers and human checkpoints. Simply, technology is a valuable tool, but humans still need to be in the loop.”
When integrating technology into a bond trading workflow it is important to set proper expectations that can be measured on a project plan timeline.
Often times expecting the unexpected is a discretionary skill that requires understanding technology’s limits.
“The best practice in tech integration is to remember that technology will not solve all of your problems, but it may be able to streamline the human workflow and optimize decision making,” Schnidman said. “If institutions keep that in mind, they are likely to adopt technology more readily, thereby making each additional innovation less jarring from a tech integration standpoint.”
With technological change coming at an increasingly rapid pace, the imperative is in understand what aspects of human trading can be modeled and what should remain discretionary.
“Instead of fully relying on quantitative approach at the beginning, it is a good starting point to integrate the output of quants and AI models in the human decision making process of position taking and dealing,” said Tsuyoshi Yokokawa, founder and CEO of San Francisco based Alpaca Markets, a firm that in parts helps integrate quantitative trading models into fundamental trading methodologies.
As the last refuge of human-based trading turns algorithmic, the processes and methodologies that drive these projects are likely to determine success or failure to a large degree.
In bond trading, the sell side is taking a different approach to that of the middle market.
Alibaba’s Singles Day Records $31B Sales, Trumps Amazon’s Biggest Day
Chinese tech and e-commerce behemoth, Alibaba, saw its one-day shopping event draw sales worth over $31B, setting a new record for the company. Labelled as its Singles Day event, the day records sales that’s bigger than Black Friday and Cyber Monday combined.
The record sales in under 24 hours dwarfs the $4B in sales Alibaba’s rival Amazon garnered during its Prime Day sale earlier this year.
Here’s why Alibaba’s CEO believes the sale is a huge winner for the company.