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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Reputation Crisis Triggers Bloodbath at Uber

C. HUYGENS - Tuesday, June 27, 2017
Uber has become a charnel house

“The ferocity and velocity of attacks in this era of weaponized social media often leads companies to try to satisfy the blood lust with human sacrifice – in the form of resignations, terminations and compensation claw-backs.”

Read more in the Insurance Business America.

Repustars 2017 June 23

C. HUYGENS - Saturday, June 24, 2017

Weekly Reputation Index Metrics


At the close of trading June 23, 2017, REPUSPX, REPUVART, and REPUVAR stood at 5525.89, 4237.68 and 3355.42 respectively. Over the past four weeks, the three have changed by 1.41%, -0.32%, and -0.37%. The benchmark S&P500 Composite Index stood at 2123.81 (31 Dec 2001=1000) and has changed over the past four weeks by 0.93%. The current calendar year spread between REPUVAR and the S&P500 is 0.11%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 18.05% and 16.36% respectively; the S&P500 Composite Index has changed by 15.38%. The trailing 12-month spread between REPUVAR and the S&P500 is 0.98%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 13.00% and 7.81% respectively; the S&P 500 Composite Index has changed by 25.04%.

The trailing 12-month, and trailing 36-month returns for REPUSPX are 21.09%, and 25.04% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 5.71%.

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 -3.76% and -4.73%.

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).
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 23 January 2017.

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 design of the portfolio is governed by principles of behavioral economics, market signaling, and the implicit timing arbitrage between the behaviors of equity stakeholder and all other stakeholders.

Reputation, Risk and Finance

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.

Wells Fargo: Regulators and Litigators Want Board Member Scalps

C. HUYGENS - Thursday, June 22, 2017
Regulators and litigators want board member scalps--Buffet may be outgunned. The reputation crisis at Wells Fargo now enters the regulatory phase, which by Steel City Re's metrics, is typically a very costly process.

"I urge you to exercise your legal authority to remove the holdover Wells Fargo Board members. Federal Reserve regulations and guidance impose clear risk-management obligations on the Board — obligations that are quite demanding for a bank as large and complex as Wells Fargo," Warren wrote. "The Board did nothing to stop rampant misconduct in the Community Bank that resulted in more than 5000 bank employees creating more than two million fake accounts over four years."

Read more in Business Insider.

Board Allowed Long-lasting Reputational Damage to Wells Fargo

C. HUYGENS - Wednesday, June 21, 2017
Senator Warren, writing to the Fed demanding the removal of all 12 directors of Wells Fargo…

…argues in the letter that the directors failed in their risk-management obligations, resulting in "massive financial losses" and "long-lasting reputational damage to the bank that has eroded the bank's customer base."

Read more in the Business Insider.

Another CEO Head, This Time Deservedly, Handed to God(s) of Reputation

C. HUYGENS - Wednesday, June 21, 2017
From the man who noted last week that Uber was suffering from a “reputational deficit”.

“There will be many pages in the history books devoted to [Travis Kalanick],” wrote Bill Gurley, an Uber board member representing one of the firms that demanded Mr Kalanick’s resignation, in a tweet. “Very few entrepreneurs have had such a lasting impact on the world.”

Read more in the Financial Times.

Measure of the Reputation Crisis at Uber

C. HUYGENS - Monday, June 19, 2017
Cornerstones of #reputation—ethics and security— and weaponized social media exacerbate #risk per Steel City Re.

Uber’s annual growth in the US slowed to 40 per cent at the end of May, from 55 per cent in the previous year, according to the data from Second Measure.

An onslaught by San Francisco-based Lyft, is taking its toll, with Uber’s US market share dropping from 84 per cent at the beginning of this year to 77 per cent at the end of May, according to data from Second Measure, a research firm that uses anonymised credit card data.

Uber’s decline in market share was fuelled by the #DeleteUber campaign at the end of January, which encouraged users to stop using the company due to Mr Kalanick’s role on President Donald Trump’s business advisory council. The campaign hit hardest in New York, Boston and San Francisco, some of Uber’s top 10 US markets.

Read more in the Financial Times.

Repustars 2017 June 16

C. HUYGENS - Sunday, June 18, 2017

Weekly Reputation Index Metrics


At the close of trading June 16, 2017, REPUSPX, REPUVART, and REPUVAR stood at 5509.04, 4217.14 and 3339.15 respectively. Over the past four weeks, the three have changed by 2.53%, -0.44%, and -0.50%. The benchmark S&P500 Composite Index stood at 2119.32 (31 Dec 2001=1000) and has changed over the past four weeks by 2.16%. The current calendar year spread between REPUVAR and the S&P500 is -0.18%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 21.79% and 20.02% respectively; the S&P500 Composite Index has changed by 17.09%. The trailing 12-month spread between REPUVAR and the S&P500 is 2.93%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 13.45% and 8.24% respectively; the S&P 500 Composite Index has changed by 25.29%.

The trailing 12-month, and trailing 36-month returns for REPUSPX are 23.83%, and 25.29% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 6.74%.

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 -3.94% and -3.81%.

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).
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 23 January 2017.

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 design of the portfolio is governed by principles of behavioral economics, market signaling, and the implicit timing arbitrage between the behaviors of equity stakeholder and all other stakeholders.

Reputation, Risk and Finance

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.

Whole Foods: Another Activist v. CEO Battle

C. HUYGENS - Thursday, June 15, 2017
Whole Foods’ John Mackey is at war with activist fund Jana

“They’re greedy bastards, and they’re putting a bunch of propaganda out there, trying to destroy my reputation and the reputation of Whole Foods, because it’s in their self-interest to do so.” ...Whole Foods has acknowledged problems — same-store sales have been falling for almost two years — but says it has a turnround plan and has promised to proceed with “a greater sense of urgency”. Last month it replaced its chief financial officer, chairman and several board members.


Read more in the Financial Times.

CEO’s Toxic Wake Creates Reputational Deficit

C. HUYGENS - Wednesday, June 14, 2017
As Uber’s board was wrestling with core governance issues arising from its sexist environment as detailed in a commissioned report, board member David Bonderman directed s sexist comment at board member Arianna Huffington.

Ms Huffington laughed awkwardly and said it would be his turn to talk soon. After the meeting, Mr Bonderman emailed Uber employees to apologise — and later announced he was resigning from the board.

“We are in a reputational deficit,” admitted board member Bill Gurley. “It is going to take us a while to get out of this.”

Read more in the Financial Times.

Speaking Volumes Silently

C. HUYGENS - Sunday, June 11, 2017
Debasing the spoken word through the weaponization of social media, oddly, increases the value of other communications channels, such as warranties and fashion.

Hardly bedfellows by any stretch of the imagination, warranties and fashion find common grounds in their ability to serve their instrumental purpose—risk transfer and cover—while expressing something else of value. Warranties express trust; and today, fashion expresses defiance.

“In this uneasy, unpredictable age of random terrorist activity, with its sudden punches of dreadful, unprovoked violence on innocent people going about their lives, the propaganda of pluck has once again become a powerful balm.”


Read more in the Financial Times.

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