CODE OF CONDUCT: Stock Story-Management Q&A-Recco Process


(Dhwanil Desai) #21

I think making suggested disclosures is a step in the right direction and shall be helpful in ensuring the conviction level of stock story initiator as Manishbhai is suggesting.

I personally feel that higher the time gap between the Management Q&A session and publication of Management Q&A on the forum, higher is the likelihood of breach of confidentiality and misuse of the information. Hence we should apply ourselves as to how can we reduce this time to bring Management Q&A to forum. My suggestion is that amongst the group of people doing every Management Q&A, we should entrust the responsibility of collating the notes and putting together Management Q&A in defined time frame to one person participating in the Q&A session . And this responsibility shall be rotated to ensure that no one person bears the work load all the time. Some senior value pickers who most likely are to be common to all Management Q&A can be excluded from this task and their role shall be to ensure that comprehensive and correct version of Management Q&A is collated. Final publishing of the Management Q&A is done by Admin.Barring unforeseen circumstances, the identified person shall ensure that Management Q&A is collated and published in given time frame.

The central idea is that for number of VP members, participating in Management Q&A means significant value addition for the overall investment journey. Hence, putting in a little extra effort of taking responsibility of collating notes shall be well worth the opportunity to participate in this process. On the other hand this will also put in some discipline and accountability to the team doing Management Q&A toward the community.


(Hardik Shah) #22

I think the community has enough trust in the senior members to know that they will not indulge in pump and dump schemes. (Pump and dump meaning hyping up a stock they have a position in with the objective of offloading their holding to the new buyers who have been taken in by the hype). The fact that Senior Members (effectively the discoverer of the ideas) will have more information prior to the others is unavoidable (Information asymmetry).

That having been said, I think the Senior Members/Core team putting out a code of conduct on their own is a great thing. I assume that what the senior members want to achieve is to avoid (to the extent possible) information asymmetry.

Information asymmetry can be avoided by two methods:

  1. Full confidentiality - Hard to achieve in today’s connected day and age

  2. Full disclosure - Unfair to the discoverer of the idea

The code of conduct that has been suggested makes a lot of sense towards that goal and strikes a reasonable balance between the two methods.

From reading this thread it seems that there have been instances where stock prices have run up even on information that a management Q&A has been scheduled. While this goes to show the credibility of valuepickr it also has the potential for misuse.

Can I suggest that if an idea is being seriously considered by the VP senior team, updates on progress can be provided to the community? For example if a management Q&A/site visit is being sought/has been scheduled, that information may be posted to the thread of that stock?

@Donald - One thing I’d like to point out is that management isnt supposed to be sharing material non public information selectively with anyone. If you think they have shared material non-public information with the team as part of the Q&A, you might want to advise them to consider publishing it on their website as well.


#23

I think some things are pretty obvious. Compulsory log-in to view be made mandatory.

Publishing materials on non market hours does not make sense. “Investors” should understand that stocks go up when there are net buyers and lot of buying interest. Senior VP core members at their discretion may post the QnA, stock story, VP portfolio, etc. when they feel like. I feel it is upto the boarders to take care and invest after doing some work themselves. Just because banco/MCS shot up after being mentioned here we should not undermine the hardwork and the altruistic nature of the people who went to meet the management. I can’t come up with original investable ideas and it is perfectly okay if a section of people have more information than others. Standard disc. whether one holds the stock would be suffix.

Also I see people hijacking threads asking for book(s) to be emailed, etc. As far as I know none of the books can be distributed as they are copy-write material. Whether one does read illegal books or not is another thing but asking for them in an open forum is another. Admins should strictly not encourage people to ask for illegal stuff. If they’ve made money (or if they think they will make money) by investing, the least they can do is buy original book/kindle version.


(Hardik Shah) #24

Interesting article that discusses some recent false disclosures by contributors to seeking alpha, forbes.com and a few other websites.

http://finance.fortune.cnn.com/2014/03/20/seeking-alpha-dreamteam-news-sites/?section=magazines_fortune

Just goes to show the code of conduct being proposed by VP is absolutely a step in the right direction.