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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Finding Opportunities in Mispriced Goodwill

C. HUYGENS - Saturday, July 04, 2015

Finance is an invitingly large tent within which a multitude of stakeholders communicate unambiguously through the language of a market's common currency. Such clarity does not persist in conversations about the drivers of value.

One stakeholder's intangible assets is another's goodwill. One's beliefs that outsized returns are the products of attention to ESG matters are no less accurate that another's confidence that the more appropriate alphabetic cause is GRC. Among behavioral economists, we call it "expectations of value," and to Directors and officers of the C-suite, this extra value boils down to "reputation."

RepuSPX and its bigger-tent cousin, RepuStars Variety, were designed to capture latent reputation value not evidenced by stock price. Said another way, these portfolios seek companies whose goodwill is mis-priced, ESG undervalued, GRC under-appreciated, or intangible asset value mis-calculated.

According to Technology Option Capital, the portfolio manager, reputational value is created through the actions of all stakeholders as a result of corporate actions that establish expectations...in such things as ESG, GRC, etc. If this value is not recognized initially by equity investors, then the latent equity value should contribute to overall market-level returns to yield above average returns upon its discovery.

This is a quarterly update of an ongoing test of the equity portfolio corollary to the basic Theory of Reputational Value.

Since 2002, weekly trailing 12-month returns of a simple reputation-based composite equity portfolio reconstituted algorithmically once a year from constituent members of the S&P500 composite equity index outperformed the S&P500 index 86.7% of the time. In 653 serial samples of trailing twelve month returns, RepuSPX generally outperformed SPX returning an excess of 9.4% on average (median 4.8%). In 92.2% of the cases of outperformance, the excess trailing 12-month returns were greater than 2%.

A time series plot shown below further demonstrates that there is useful information on latent (reputation-sourced) enterprise value in  Steel City Re's Reputational Value Metrics. The cumulative price returns through 3 July 2015 are 390.33% for RepuSPX and 77.12% for the S&P500.

RepuStars 2015 July 3

C. HUYGENS - Friday, July 03, 2015

Weekly Reputation Index Metrics


At the close of trading July 2, 2015, REPUVART and REPUVAR stood at 4108.61 and 3354.80 respectively. Over the past four weeks, the former has changed by -3.22%, while the latter has changed by -3.35%. The benchmark S&P500 Composite Index stood at 1808.92 (31 Dec 2001=1000) and has changed over the past four weeks by -0.77%. The current calendar year spread between REPUVAR and the S&P500 is 10.71%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 8.06% and 6.48% respectively; the S&P500 Composite Index has changed by 4.60%. The trailing 12-month spread between REPUVAR and the S&P500 is 1.88%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 45.19% and 37.39% respectively; the S&P 500 Composite Index has changed by 51.15%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are -0.92%, 9.79%, and 96.37% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 5.19%.

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 -6.64% and 3.31%.

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 on the Society's website (click here), and elsewhere.

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 at the close of the markets 16 January 2015.

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. Click here for an analysis of periodic returns.

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). Briefly, the design of the portfolio is governed by the theory that sometime over the course of the forward twelve months from portfolio construction, 3rd week of January in the current application, equity investors will come to appreciate the value implied by the reputation metrics.

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
Society and engage.
2. 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.

Consensiv 50 July 2015

C. HUYGENS - Wednesday, July 01, 2015
The Consensiv 50 is an unweighted ranking of indicated reputational value drawn from the world's 1000 most valuable traded companies. The underlying reputational value metrics, calculated weekly for more than 7000 companies, are the underpinnings of Steel City Re’s reputational value insurances and the S&P Dow Jones RepuStars Variety Corporate Reputation Index (Ticker: REPUVAR), the world’s only reputation-linked composite equity index*. Read more about Consensiv's reputation insights and controls.


RepuStars 2015 June 26

C. HUYGENS - Saturday, June 27, 2015

Weekly Reputation Index Metrics


At the close of trading June 26, 2015, REPUVART and REPUVAR stood at 4202.22 and 3431.65 respectively. Over the past four weeks, the former has changed by 1.05%, while the latter has changed by 0.91%. The benchmark S&P500 Composite Index stood at 1830.54 (31 Dec 2001=1000) and has changed over the past four weeks by -0.27%. The current calendar year spread between REPUVAR and the S&P500 is 12.06%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 11.77% and 10.00% respectively; the S&P500 Composite Index has changed by 7.38%. The trailing 12-month spread between REPUVAR and the S&P500 is 2.63%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 56.98% and 48.54% respectively; the S&P 500 Composite Index has changed by 59.21%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are 0.23%, 12.37%, and 101.03% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 4.99%.

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 -7.47% and 2.37%.

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 on the Society's website (click here), and elsewhere.

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 at the close of the markets 16 January 2015.

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. Click here for an analysis of periodic returns.

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). Briefly, the design of the portfolio is governed by the theory that sometime over the course of the forward twelve months from portfolio construction, 3rd week of January in the current application, equity investors will come to appreciate the value implied by the reputation metrics.

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
Society and engage.
2. 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 2015 June 19

C. HUYGENS - Saturday, June 20, 2015

Weekly Reputation Index Metrics


At the close of trading June 19, 2015, REPUVART and REPUVAR stood at 4235.31 and 3459.45 respectively. Over the past four weeks, the former has changed by 0.59%, while the latter has changed by 0.41%. The benchmark S&P500 Composite Index stood at 1837.84 (31 Dec 2001=1000) and has changed over the past four weeks by -0.76%. The current calendar year spread between REPUVAR and the S&P500 is 12.58%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 12.70% and 10.92% respectively; the S&P500 Composite Index has changed by 7.68%. The trailing 12-month spread between REPUVAR and the S&P500 is 3.24%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 53.75% and 45.32% respectively; the S&P 500 Composite Index has changed by 55.38%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are -0.18%, 13.21%, and 104.16% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 5.53%.

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 -7.17% and 2.29%.

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 on the Society's website (click here), and elsewhere.

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 at the close of the markets 16 January 2015.

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. Click here for an analysis of periodic returns.

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). Briefly, the design of the portfolio is governed by the theory that sometime over the course of the forward twelve months from portfolio construction, 3rd week of January in the current application, equity investors will come to appreciate the value implied by the reputation metrics.

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
Society and engage.
2. 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.

D&O's Weakened DNA

C. HUYGENS - Wednesday, June 17, 2015
That ol' liability insurance just ain't what it used to be. Gone is the roar of certain protection. "D&O insurance today merely whispers relative to the noise of 21st century threats — especially from social media, regulatory scrutiny, and investor activism — to directors’ 'personal capital or their reputations.'”

And while these threats are at least discussed in corporate filings, disclosures do not have great signaling gravitas or impact, nor are they as robust and convincing as talking money.

Read More at Risk & Insurance.

Procter & Gamble: So what's new

C. HUYGENS - Monday, June 15, 2015
When A.G. Laffley took over Procter & Gamble in June 2000, he engineered a turnaround by focusing his managers on selling the company's major brands such as Tide, Pampers, and Crest. And he strategically moved the firm's focus away from trying ot develop the next big thing, because in the 15 prior years, P&G had develped exactly one successful new brand--the Swiffer dust mop.

In 2003, Bloomberg described the R&D transition this way:

"No bastion has been more challenged than P&G's research and development operations. Lafley has confronted head-on the stubbornly held notion that everything must be invented within P&G, asserting that half of its new products should come from the outside. (P&G now gets about 20% of its ideas externally -- up from about 10% when he took over.) "He's absolutely breaking many well-set molds at P&G," says eBay (EBAY) Inc.'s CEO, Margaret C. "Meg" Whitman, whom Lafley appointed to the board.

Lafley's quest to remake P&G could still come to grief. As any scientist will attest, buying innovation is tricky. Picking the winners from other labs is notoriously difficult and often expensive. And P&G will remain uncomfortably reliant on Wal-Mart (WMT) Stores Inc., which accounts for nearly a fifth of its sales. Lafley is looking to pharmaceuticals and beauty care for growth, where the margins are high but where P&G has considerably less experience than rivals.

The biggest risk, though, is that Lafley will lose the P&Gers themselves. Theirs is a culture famously resistant to new ideas. To call the company insular may not do it justice. Employees aren't kidding when they say they're a family. They often start out there and grow up together at P&G, which only promotes from within. Cincinnati itself is a small town: Employees live near one another, they go to the same health clubs and restaurants. They are today's company men and women -- and proud of it."


When a firm's reputation as a marketing powerhouse is undercut by the firm's departure from the big M of marketing (Product, Price, Promotion and Placemant) to the little m of marketing (Promotion and Placement), what becomes of that reputation? And what value is left in a firm that can promote products in an age where innovation and experiences, as well as innovative experiences enabled by innovative products, top the value-generation charts?

Lafley's been back at the helm for a little over two years (Click on prior blog note). Notwithstanding his personal charm, his prior success, and the fact that sequels are usually the smarter bet, the metrics suggest his slash and burn approach is unlikely to generate sustainable value this time around.

Twitter: Canary in the coal mine

C. HUYGENS - Sunday, June 14, 2015
Life for an actual canary in a coal mine, like that of Twitter CEO Dick Costolo, could be described in three words: "short but meaningful."

Canaries are especially sensitive to toxic gases like methane and carbon monoxide, which made them ideal for detecting any dangerous gas build-ups. As long as the bird kept tweeting, the miners knew their air supply was safe.

After five years at the helm, the toxicity of criticism proved to be too much. Last week, one of the company’s biggest shareholders and cheerleaders, Chris Sacca, publicly called for a change in management. Mr. Costolo announced that he plans to stop singing July 1.

Investor hope springs eternal. Twitter shares rose more than 7 percent in after-hours trading immediately after the change in leadership was announced. The Reputational Value Metrics, ranking Twitter's Reputation Premium at below the first decile  (shown below), suggest other stakeholders have modest expectations.

In the coal mines, the sudden end to a canary's incessant tweeting signaled need for an immediate evacuation.

RepuStars 2015 June 12

C. HUYGENS - Saturday, June 13, 2015

Weekly Reputation Index Metrics


At the close of trading June 12, 2015, REPUVART and REPUVAR stood at 4245.21 and 3468.78 respectively. Over the past four weeks, the former has changed by 2.12%, while the latter has changed by 1.95%. The benchmark S&P500 Composite Index stood at 1824.01 (31 Dec 2001=1000) and has changed over the past four weeks by -1.35%. The current calendar year spread between REPUVAR and the S&P500 is 13.66%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 14.51% and 12.74% respectively; the S&P500 Composite Index has changed by 8.50%. The trailing 12-month spread between REPUVAR and the S&P500 is 4.24%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 58.77% and 50.09% respectively; the S&P 500 Composite Index has changed by 58.14%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are -0.47%, 14.58%, and 101.39% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 6.08%.

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 -8.63% and 1.83%.

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 on the Society's website (click here), and elsewhere.

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 at the close of the markets 16 January 2015.

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. Click here for an analysis of periodic returns.

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). Briefly, the design of the portfolio is governed by the theory that sometime over the course of the forward twelve months from portfolio construction, 3rd week of January in the current application, equity investors will come to appreciate the value implied by the reputation metrics.

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
Society and engage.
2. 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 2015 June 5

C. HUYGENS - Saturday, June 06, 2015

Weekly Reputation Index Metrics


At the close of trading June 5, 2015, REPUVART and REPUVAR stood at 4245.15 and 3470.97 respectively. Over the past four weeks, the former has changed by 2.93%, while the latter has changed by 2.82%. The benchmark S&P500 Composite Index stood at 1822.90 (31 Dec 2001=1000) and has changed over the past four weeks by -1.10%. The current calendar year spread between REPUVAR and the S&P500 is 13.80%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 14.54% and 12.76% respectively; the S&P500 Composite Index has changed by 7.85%. The trailing 12-month spread between REPUVAR and the S&P500 is 4.91%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 62.58% and 53.77% respectively; the S&P 500 Composite Index has changed by 62.80%.

The 4-week, trailing 12-month, and trailing 36-month returns for REPUSPX are -0.03%, 13.00%, and 100.75% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 5.14%.

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 -9.53% and 0.24%.

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 on the Society's website (click here), and elsewhere.

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 at the close of the markets 16 January 2015.

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. Click here for an analysis of periodic returns.

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). Briefly, the design of the portfolio is governed by the theory that sometime over the course of the forward twelve months from portfolio construction, 3rd week of January in the current application, equity investors will come to appreciate the value implied by the reputation metrics.

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
Society and engage.
2. 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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