MISSION INTANGIBLE

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MISSION:INTANGIBLE, the blog of the Intangible Asset Finance Society, offers critical comments on intangible asset, corporate reputation, and finance; supplemented by quantitative reputation metrics. Intangible assets include business processes, patents, trademarks; reputations for ethics and integrity; quality, safety, sustainability, security, and resilience; and comprise 70% of the average company's value. MISSION:INTANGIBLE is a registered trademark of the Intangible Asset Finance Society.

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RepuStars 2014 July 18

C. HUYGENS - Monday, July 21, 2014

Weekly Reputation Index Metrics


At the close of trading July 18, 2014, REPUVART and REPUVAR stood at 3753.88 and 3110.54 respectively. Over the past four weeks, the former has changed by -0.53%, while the latter has changed by -0.68%. The benchmark S&P500 Composite Index stood at 1723.07 (31 Dec 2001=1000) and has changed over the past four weeks by 0.78%. The current calendar year spread between REPUVAR and the S&P500 is -5.07%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 7.42% and 5.22% respectively; the S&P500 Composite Index has changed by 17.10%. The trailing 12-month spread between REPUVAR and the S&P500 is -11.88%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 33.11% and 25.99% respectively; the S&P 500 Composite Index has changed by 49.10%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are -1.55%, 8.46%, and 86.00% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -8.64%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 1.27% and 3.23%.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

Security: Haskell makes the ephemeral real

C. HUYGENS - Monday, July 14, 2014
Amongst all the chatter about reputation and intangibles, one would be tempted to relegate its importance to a category that includes inventorying angels atop  pins. Security, one of the six pillars of reputation, is the most ephemeral. Yet in a flash, the concepts of reputation and security can become real and deadly.

Reputation is an expectation of behavior. Ronald Lee Haskell had a somewhat established reputation for violence involving family members. Haskell is now is charged with having executed six members of his ex-wife’s family. Read more.

RepuStars 2014 July 11

C. HUYGENS - Sunday, July 13, 2014

Weekly Reputation Index Metrics


At the close of trading July 11, 2014, REPUVART and REPUVAR stood at 3728.86 and 3089.81 respectively. Over the past four weeks, the former has changed by 0.33%, while the latter has changed by 0.17%. The benchmark S&P500 Composite Index stood at 1713.79 (31 Dec 2001=1000) and has changed over the past four weeks by 1.62%. The current calendar year spread between REPUVAR and the S&P500 is -5.18%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 7.77% and 5.56% respectively; the S&P500 Composite Index has changed by 17.47%. The trailing 12-month spread between REPUVAR and the S&P500 is -11.90%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 34.97% and 27.74% respectively; the S&P 500 Composite Index has changed by 49.78%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 2.13%, 11.61%, and 82.54% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -5.86%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 3.42% and 6.04%.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

GM: Beating the odds at 1 in 6000

C. HUYGENS - Wednesday, July 09, 2014
In a game of heads you win, tails I lose, the only strategy is land a coin on its edge. According to Daniel Murray and Scott Teare writing in Physical Review E, the probability of an American nickel landing on edge is approximately 1 in 6000 tosses.

In a game of bet-the-company, those aren't great odds. Caught between customers and victims who wanted open ended compensation, and creditors and investors who wanted to protect GM's assets from open compensation, CEO Mary Barra was bound to anger at least one key stakeholder group -- and therefore lose. As the metrics below report, she beat the odds and successfully delighted both.

According to the reputation analysis published by Consensiv, the reputation controls company, based on reputation value metrics from Steel City Re, the reputation insurer, GM's reputation benefitted from the appointment of Kenneth Feinberg to oversee GM's compensation fund.

The bump to observe on the graph begins around June 15th, the week Google Trends shows a significant and steady uptake in Google search interest in Kenneth Feinberg. That same week witnessed the beginning of an uptick in the reputation metrics. GM’s reputation premium, a measure of additional value arising from favorable stakeholder expectations, rose to the 46th percentile within the 37-member automotive peer group, while the consensus trend, a measure of stakeholder surprise, showed a reasonable increase up to 1.2%.

Of course, the company’s overall reputation health is still middling.

The strategy Barra used has a name. Read all about it at Risk & Insurance or at Business Insurance.

RepuStars 2014 July 4

C. HUYGENS - Monday, July 07, 2014

Weekly Reputation Index Metrics


At the close of trading July 4, 2014, REPUVART and REPUVAR stood at 3802.24 and 3150.61 respectively. Over the past four weeks, the former has changed by 2.13%, while the latter has changed by 1.92%. The benchmark S&P500 Composite Index stood at 1729.36 (31 Dec 2001=1000) and has changed over the past four weeks by 1.85%. The current calendar year spread between REPUVAR and the S&P500 is -4.14%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 14.16% and 11.83% respectively; the S&P500 Composite Index has changed by 22.91%. The trailing 12-month spread between REPUVAR and the S&P500 is -11.08%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 35.96% and 28.65% respectively; the S&P 500 Composite Index has changed by 48.40%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 1.97%, 16.60%, and 87.72% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -6.31%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 1.89% and 4.77%.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

RepuStars 2014 June 27

C. HUYGENS - Thursday, July 03, 2014

Weekly Reputation Index Metrics


At the close of trading June 27, 2014, REPUVART and REPUVAR stood at 3767.92 and 3126.34 respectively. Over the past four weeks, the former has changed by 2.46%, while the latter has changed by 2.31%. The benchmark S&P500 Composite Index stood at 1708.03 (31 Dec 2001=1000) and has changed over the past four weeks by 1.94%. The current calendar year spread between REPUVAR and the S&P500 is -3.61%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 13.15% and 10.94% respectively; the S&P500 Composite Index has changed by 21.56%. The trailing 12-month spread between REPUVAR and the S&P500 is -10.62%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 39.53% and 32.20% respectively; the S&P 500 Composite Index has changed by 51.23%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 2.55%, 16.83%, and 91.23% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -4.72%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 1.97% and 5.89%.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

RepuStars 2014 June 20

C. HUYGENS - Friday, June 20, 2014

Weekly Reputation Index Metrics


At the close of trading June 20, 2014, REPUVART and REPUVAR stood at 3773.81 and 3131.93 respectively. Over the past four weeks, the former has changed by 3.39%, while the latter has changed by 3.24%. The benchmark S&P500 Composite Index stood at 1709.70 (31 Dec 2001=1000) and has changed over the past four weeks by 3.28%. The current calendar year spread between REPUVAR and the S&P500 is -3.53%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 15.13% and 12.84% respectively; the S&P500 Composite Index has changed by 23.59%. The trailing 12-month spread between REPUVAR and the S&P500 is -10.75%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 40.16% and 32.80% respectively; the S&P 500 Composite Index has changed by 51.51%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 4.01%, 17.97%, and 96.43% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -5.62%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 2.20% and 5.14%.

Other interval changes in the magnitude of the indices are shown in the tables and charts below.

Analysis

There is little Huygens can add to the words of Jack Steiman, writing on June 20 for AdviceTrade.com:

there really is very little, if anything, to add to what I have been talking about for weeks, if not months. The market is somehow finding a way to hang in there against all the odds. The froth and greed are ramping higher by the day as the market hangs tough. Yet, through all this greed and froth the market doesn't fall. It should get crushed, yet it doesn't.

The greatest gains in the RepuStars Variety portfolio for 2014 year are being reported by Weatherford Intl. plc (WFT),which is in first place with returns of 57.12% for the year; Cavium Inc (CAVM) is in second place with returns of 45.10% for the year; and BRF SA (ADR) (BRFS) is third first place with returns of 28.05% for the year. These are three of the 41 firms identified by the RepuStars Variety algorithm at the start of 2014 as value opportunities.

As for those whose reputational value may have been overestimated, Pharmacyclics, Inc. (PCYC) is trailing the entire portfolio with returns of -34.24% for the year; VistaPrint Limited (VPRT) is second from last place with returns of -22.05% for the year; and Staples, Inc. (SPLS) is third from last with returns so far this year of -19.44%.

Turning to RepuSPX whose constituents are limited to the S&P500 members, the top three performers in a portfolio of 35 names are Pepco Holdings, Inc. (POM) is in first place with returns of 46.79% for the year; Entergy Corporation (ETR) is in second place with returns of 31.69% for the year; and Lorillard Inc. (LO) is in third place with returns of 31.65% for the year.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

Double Secret Probation Warning to the Fed

C. HUYGENS - Wednesday, June 18, 2014
Signaling financial markets with extra-financial information creates value because it helps balance the asymmetry in information between insiders and outside investors. When the signal conveys lower risk, the result is an expectation of increased value. Consider this quote from the Financial Times for June 16, 2014 discussing how signaling can help reduce risk.

Note that the problem appears to be a belief in certainty by the markets and a belief in uncertainty by the IMF chief, and a request for the Fed chairwoman to increase the level of uncertainty in the markets through more frequent communications.

Ms. Lagarde…, the IMF chief(,) said the path for Fed policy remains highly uncertain, “while at the same time there seems to be a large amount of certainty in markets about where policy rates are going to go”…this “‘sets up the risk, even with a successful and well-communicated increase in interest rates, for significant swings in market flows and prices in the months ahead. If such volatility were to unfold, it would have implications that would reach far beyond US borders.” Ms Lagarde called for Fed chairwoman Janet Yellen to hold more frequent press conferences, up from the current four a year, to reduce the chances of a miscommunication.

RepuStars 2014 June 13

C. HUYGENS - Tuesday, June 17, 2014

Weekly Reputation Index Metrics


At the close of trading June 13, 2014, REPUVART and REPUVAR stood at 3716.76 and 3084.58 respectively. Over the past four weeks, the former has changed by 1.68%, while the latter has changed by 1.49%. The benchmark S&P500 Composite Index stood at 1686.43 (31 Dec 2001=1000) and has changed over the past four weeks by 3.10%. The current calendar year spread between REPUVAR and the S&P500 is -3.63%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 10.40% and 8.20% respectively; the S&P500 Composite Index has changed by 18.32%. The trailing 12-month spread between REPUVAR and the S&P500 is -10.12%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 40.02% and 32.67% respectively; the S&P 500 Composite Index has changed by 50.34%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 1.33%, 13.21%, and 91.24% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -5.11%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 1.39% and 5.01%.

Other interval changes in the magnitude of the indices are shown in the tables and charts below.

Analysis

Huygens has signaled his discomfort for more than a year, and while he is not a bear in the sense that he does not short the market, he remains uncomfortable. He is not alone, but he and his peers who do short the market are being derided.

Take this opening paragraph from Bloomberg’s Callie Bost late last week: “For five years it’s been the fate of American short sellers to be wrong, as the biggest rally since the Internet bubble steamrolled defensive trades. They’re loading up again, sending bearish wagers..." The market continues to rally, and one has to wonder if the bearish bets are among the causes. "'Those short-sellers will have to cover and that actually can help push markets higher,” Kate Warne, a St. Louis-based investment strategist at Edward Jones, which oversees $787 billion, said in a June 4 interview at Bloomberg’s headquarters in New York.”

Market fundamentals and sentiment, like gravity, are forces to be reckoned with. In the meantime, turning to the quantitative metrics, the greatest gains in the RepuStars Variety portfolio for 2014 year are being reported by Weatherford Intl. Ltd (WFT) is in first place with returns of 52.35% for the year; Cavium Inc (CAVM) is in second place with returns of 49.02% for the year; and Rite Aid Corporation (RAD) is third first place with returns of 28.09% for the year. These are three of the 41 firms identified by the RepuStars Variety algorithm at the start of 2014 as value opportunities.

As for those whose reputational value may have been overestimated, Pharmacyclics, Inc. (PCYC) is trailing the entire portfolio with returns of -31.39% for the year; VistaPrint Limited (VPRT) is second from last place with returns of -20.13% for the year; and Staples, Inc. (SPLS) is third from last with returns so far this year of -19.58%.

Turning to RepuSPX whose constituents are limited to the S&P500 members, the top three performers in a portfolio of 35 names are Pepco Holdings, Inc. (POM) is in first place with returns of 46.04% for the year; Garmin Ltd. (GRMN) is in second place with returns of 29.66% for the year; and Entergy Corporation (ETR) is in third place with returns of 27.92% for the year.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

RepuStars 2014 June 6

C. HUYGENS - Sunday, June 08, 2014

Weekly Reputation Index Metrics


At the close of trading June 6, 2014, REPUVART and REPUVAR stood at 3722.94 and 3091.30 respectively. Over the past four weeks, the former has changed by 2.75%, while the latter has changed by 2.60%. The benchmark S&P500 Composite Index stood at 1698.00 (31 Dec 2001=1000) and has changed over the past four weeks by 3.78%. The current calendar year spread between REPUVAR and the S&P500 is -4.14%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 11.03% and 8.87% respectively; the S&P500 Composite Index has changed by 20.15%. The trailing 12-month spread between REPUVAR and the S&P500 is -11.27%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 40.27% and 32.92% respectively; the S&P 500 Composite Index has changed by 51.71%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 1.39%, 17.58%, and 88.01% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is -2.57%.

The spreads between the S&P500-only index informed by reputation metrics, REPUSPX, and the broad market index informed by reputation metrics, REPUVAR, for the calendar year and for the trailing twelve months respectively are 1.80% and 8.71%.

Other interval changes in the magnitude of the indices are shown in the tables and charts below.

Analysis

Huygens remains uncomfortable. The housing bubble of the early ought’s fueled the equity bubble; and it was illiquidity from depreciating housing values that fanned the flames of the equity collapse. There is no shortage of chatter on global housing bubbles, again. And the band plays on.

Turning to the quantitative metrics, the greatest gains in the RepuStars Variety portfolio for 2014 year are being reported by Weatherford Intl. Ltd (WFT) is in first place with returns of 55.69% for the year; Cavium Inc (CAVM) is in second place with returns of 43.85% for the year; and Rite Aid Corporation (RAD) is third first place with returns of 38.10% for the year. These are three of the 41 firms identified by the RepuStars Variety algorithm at the start of 2014 as value opportunities.

As for those whose reputational value may have been overestimated, Pharmacyclics, Inc. (PCYC) is trailing the entire portfolio with returns of -30.84% for the year; VistaPrint Limited (VPRT) is second from last place with returns of -22.40% for the year; and Staples, Inc. (SPLS) is third from last with returns so far this year of -19.15%.

Turning to RepuSPX whose constituents are limited to the S&P500 members, the top three performers in a portfolio of 35 names are Pepco Holdings, Inc. (POM) is in first place with returns of 46.84% for the year; Garmin Ltd. (GRMN) is in second place with returns of 28.40% for the year; and Entergy Corporation (ETR) is in third place with returns of 27.75% for the year.

Side Note: A description of the portfolio constituents and historical returns data from December 31, 2001 can be obtained on request from Technology Option Capital, its manager. Click Here.

Background

The RepuStars® Variety Corporate Reputation Index calculated by S&P/Dow Jones Indexes is the first-ever composite equity index based on a quantitative value strategy informed by the Steel City Re Reputational Value Metrics. The metrics comprise non-financial indicators of reputational value (RVM) and ranking (CRR). These are the same metrics that power the reputation controls provided by Consensiv, and the league table of reputational value, the Consensiv 50,  published periodically, and most recently January 1, 2014, by CFO.com.

The RepuStars Variety Corporate Reputation Index has two versions: a total returns index and a price index, whose ticker symbols are, respectively, REPUVART and REPUVAR.  Click on the ticker names for real time quotes.

The RepuStars Variety Corporate Reputation Index tracks up to 57 company stocks that appear to be underpriced relative to  Steel City Re’s proprietary Reputational Value Metrics™, which track 7400 companies weekly. The principles behind measuring reputational value are described in the book, Reputation, Stock Price, and You: Why the market rewards some companies and punishes others (2012, Apress).

The RepuStars indices are reconstituted annually in the first week of January and posted by S&P/Dow Jones Indexes in the third week. The Indices were last reconstituted 18 Jan 2014.

REPUSPX  is a pocket index with portfolio constituents being selected algorithmically by the same criteria as the constituents for REPUVAR and REPUVART, except that the field of eligible companies is limited to constituents of the S&P500 composite equity index.

The strategy used to pick the constituent members of REPUSPX, REPUVAR and REPUVART is discussed in the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (Apress, 2012). (Link below)

Reputation, Risk and Finance

Reputation management through superior control of a company's intangible assets may be one of the best paths to value creation today. If it is not on your agenda, perhaps it should be. Here are several things you can do right now to start creating value for your organization:

1. Become better informed. Participate in our regular Mission Intangible Monthly Briefings held on the second Friday of every month, read the book, Reputation, Stock Price and You: Why the market rewards some companies and punishes others (2012)  or its predecessor, Mission: Intangible. Managing risk and reputation to create enterprise value (2010), available at the IAFS Store, specialty finance sector retailers, or other leading online book retailers
2. Become a member of the Intangible Asset Finance Society and engage.
3. Join our community on Linked-In and stay in the information flow and/or follow Twitter missives at #ReputationRisk.

Notices

S&P Dow Jones Indices is a registered trademark of S&P Dow Jones Indices LLC, a part of McGraw Hill Financial; RepuStars and Steel City Re” are registered trademarks of C. Huygens & Co. LLC. The method underpinning the RepuStars Variety indexes is subject to a pending patent assigned to C. Huygens & Co. LLC. S&P McGraw Hill Financial and its affiliate (S&P Dow Jones Indices) makes no representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and McGraw Hill Financial shall have no liability for any errors, omissions, or interruptions of any index or the data included therein. Past performance of an index is not an indication of future results. All information provided by S&P Dow Jones Indices is general in nature and not tailored to the needs of any person, entity or group of persons. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties. It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments offered by third parties that are based on that index. S&P Dow Jones Indices does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that seeks to provide an investment return based on the performance of any Index. Investment products based on the RepuStars Variety Corporate Reputation Indexes are not sponsored, endorsed, sold or promoted by Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC, or their respective affiliates and none of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC and their respective affiliates make any representation regarding the advisability of investing in such products. Inclusion of a company in any of the indexes in this piece does not in any way reflect an opinion of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates on the investment merits of such company. None of Technology Option Capital, LLC, C. Huygens & Co, LLC, Steel City Re, LLC or any of their respective affiliates is providing investment advice in connection with these indexes.

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