MISSION INTANGIBLE

M:I Products

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.

Read future M:I posts via RSS RSS

Timing the Measurement of Reputation Loss

C. HUYGENS - Sunday, September 24, 2017
The loss and stabilization of President Trump's reputation mirrored the pattern seen with event-driven corporate reputation losses, as predicted by Steel City Re on May 19.

Reputation value loss is indemnifiable through Steel City Re's reputation assurance solutions. Determination of the magnitude of the loss is made 20 weeks after recognition of all three triggers of the policy. This time window for discovery of the actual going-forward magnitude of reputation value loss was memorialized in Steel City Re's processes after the empirical study of of tens of thousands of  reputational loss events. The bottom line, is that at around 20 weeks after an event is recognized by stakeholders,  the resuilting corporate reputation stabilizes at its new level. This level becomes the new corporate reputation baseline until a new adverse event or favorably surprise shocks the market and materially resets the reputational value again.

On the basis of this empirical model, Steel City Re predicted in the Financial Times on 19 May that President Donald Trump's deteriorating reputation would stabilize on or about 18 September 2017. Reports from NPR and Rasmussen Reports published on 22 and 23 September confirm this prediction.

From NPR: President Trump's poll slide appears to have stabilized.

From Rasmussen Reports:  The Rasmussen Reports daily Presidential Tracking Poll for Friday shows that 43% of Likely U.S. Voters approve of President Trump’s job performance. Fifty-five percent (55%) disapprove.

The latest figures include 27% who Strongly Approve of the way the president is performing and 44% who Strongly Disapprove. This gives him a Presidential Approval Index rating of -17. (see trends).

The Steel City Re model suggests that the current measure of reputational value will be stable until a shock such as a major event on the Korean peninsula or revelations from Robert Mueller’s sprawling special-counsel investigation resets stakeholder expectations once again.

Repustars 2017 September 22

C. HUYGENS - Saturday, September 23, 2017

Weekly Reputation Index Metrics


At the close of trading September 22, 2017, REPUSPX, REPUVART, and REPUVAR stood at 5690.51, 4508.73 and 3556.67 respectively. Over the past four weeks, the three have changed by 3.90%, 4.93%, and 4.77%. The benchmark S&P500 Composite Index stood at 2179.48 (31 Dec 2001=1000) and has changed over the past four weeks by 2.42%. The current calendar year spread between REPUVAR and the S&P500 is 3.73%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 16.23% and 14.67% respectively; the S&P500 Composite Index has changed by 14.93%. The trailing 12-month spread between REPUVAR and the S&P500 is -0.26%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 23.22% and 17.56% respectively; the S&P 500 Composite Index has changed by 26.20%.

The trailing 12-month, and trailing 36-month returns for REPUSPX are 21.87%, and 26.20% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 6.94%.

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 -0.63% and -7.20%.

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.

Fleeing Clients Indicate Reputational Damage

C. HUYGENS - Wednesday, September 20, 2017
KPMG and McKinsey have scrambled to limit the damage caused by their links to the Gupta family, which is at the center of South Africa’s worst political scandal since the apartheid era.

“KPMG on Tuesday lost two further audit contracts in South Africa and faced widespread reviews as clients sought to distance themselves from reputational damage from their links to the firm. McKinsey faced allegations of fraud and collusion in corruption from South Africa’s main opposition party over the management consultant’s work with a company linked to the Guptas, the family accused of corrupting state contracts through ties to President Jacob Zuma.”

Read more in Financial Times.

Repustars 2017 September 15

C. HUYGENS - Sunday, September 17, 2017

Weekly Reputation Index Metrics


At the close of trading September 15, 2017, REPUSPX, REPUVART, and REPUVAR stood at 5684.86, 4449.01 and 3510.12 respectively. Over the past four weeks, the three have changed by 3.79%, 4.93%, and 4.77%. The benchmark S&P500 Composite Index stood at 2177.75 (31 Dec 2001=1000) and has changed over the past four weeks by 3.08%. The current calendar year spread between REPUVAR and the S&P500 is 2.33%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 18.00% and 16.41% respectively; the S&P500 Composite Index has changed by 16.44%. The trailing 12-month spread between REPUVAR and the S&P500 is -0.03%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 17.75% and 12.36% respectively; the S&P 500 Composite Index has changed by 25.08%.

The trailing 12-month, and trailing 36-month returns for REPUSPX are 23.54%, and 25.08% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 7.10%.

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 -2.01% and -7.12%.

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.

Artful Dodger When Reputation in the Cross Hairs

C. HUYGENS - Thursday, September 14, 2017
Even when dutiful, loyal and competent, the personal #reputations of senior executives and board members stand in the crosshairs.

“CEOs need new tools like reputation assurance products to provide third party warranties and demonstrate good governance in a way that creates an easy to understand, and completely credible alternative narrative when stakeholder dissatisfaction rears its head.”

Read more in Industry Week.

Peak Bloodlust: Now it's McKinsey

C. HUYGENS - Wednesday, September 13, 2017
Activists target McKinsey over South African ethics issues. The scandal surrounding the country’s controversial Gupta business family that destroyed UK PR firm Bell Pottinger and is brushing against KPMG continues to spread to international firms.:

“Corruption Watch, a non-government organisation in South Africa, said it plans to approach anti-bribery prosecutors at the US Department of Justice within the next two weeks to ask them to investigate McKinsey’s work with Gupta-linked entities.”

Read more in Financial Times.

Smelling Blood, Activists Target Another Professional Services Firm

C. HUYGENS - Tuesday, September 12, 2017
Activists target KPMG over South African ethics issues. Response:

“We’re determined to rebuild the public’s trust in KPMG’s South African firm, and will stand behind the firm and will work with it for as long as it takes…”

Read more in Financial Times.

Fund Reputation For Sexual Harassment A Liability

C. HUYGENS - Monday, September 11, 2017
Investors seek to avoid funds whose GP’s sexually harass prospect & portfolio company executives.

"The Institutional Limited Partners Association is aiming to help investors avoid funds where this has taken place, with improved detection of any past harassment incidents during the due diligence process."

Read more in Financial Times.

Repustars 2017 September 8

C. HUYGENS - Sunday, September 10, 2017

Weekly Reputation Index Metrics


At the close of trading September 8, 2017, REPUSPX, REPUVART, and REPUVAR stood at 5511.01, 4399.39 and 3471.83 respectively. Over the past four weeks, the three have changed by 0.71%, 2.71%, and 2.50%. The benchmark S&P500 Composite Index stood at 2143.95 (31 Dec 2001=1000) and has changed over the past four weeks by 0.82%. The current calendar year spread between REPUVAR and the S&P500 is 2.81%.

Over the trailing twelve months, REPUVART and REPUVAR have, respectively, changed by 13.47% and 11.96% respectively; the S&P500 Composite Index has changed by 12.84%. The trailing 12-month spread between REPUVAR and the S&P500 is -0.88%.

Over the trailing 36 months, the REPUVART and REPUVAR have changed by 15.05% and 9.78% respectively; the S&P 500 Composite Index has changed by 23.79%.

The trailing 12-month, and trailing 36-month returns for REPUSPX are 17.43%, and 23.79% respectively. The trailing 12-month spread between REPUSPX and the S&P500 is 4.58%.

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 0.26% and -5.47%.

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.

Unrealistic Expectations Create Risk of Earnings Torpedo

C. HUYGENS - Saturday, September 09, 2017
A reminder of the value of corporate governance and prompt candid disclosure of bad news especially when expectations are unrealistic.

“…the longer a company takes to come clean, the bigger and more damaging the ‘earnings torpedo’ that hits its share price and its reputation once the true numbers come out.”

Read more in Financial Times.

Recent Comments


SuMoTuWeThFrSa
     1
2
34
5
6
7
8
9
10
11
12
13
14
1516
17
1819
20
2122
23
24
252627282930
 

Subjects

Archive