Following is excerpted out of the earlier discussion - Ensuring a participative balanced discussion. ValuePickr Admin was entrusted with ensuring Transparency and Accountability - for building up higher Credibility for the Community.
It’s a good idea to go through again and re-inforce the considered confidence-building views summarised earlier in this post.
2). A closer examination of the research data and posts made - shows an emphasis on huge amounts of data, and news/events around the company or industry, butnegligible emphasis on Valuation. End of the day thePrice you get in, is themost important. If you get the Price entry wrong, all your in-depth research is practically useless. On the other hand if you get the entry price right, you do not need much in-depth data. Getting the big picture right is enough!
3). Once the basic data set is in - like say our impartial/neutral Stock Story is in - most of the discussion should be aroundValuation. If there is Value, it should scream a Value buy out at us. The danger with too much emphasis on data and news & events is that it**drowns the focus on Undervaluation.**While senior investors can come to their own conclusions, 90% of any online community as ours cannot. Most of them look to be free-riders on folks they get to trust. If they get in at the wrong price, and do not get warnings for exit, they flirt with disaster - and in ValuePickr itself there has been atleast 3 instances of disaster!!
4). ValuePickr is a small forum with ~3000 registered users today in last 2 years. The pace has accelerated as new folks are joining the effort -and our dream of bringing together amateur investors, senior investors, industry professionals, Institutional Investors - in a collaborative model is taking firm roots. We have also had some decent success, we have some measure of accountability and transparency built-in, there is some TRUST. Beginner Investors have started flocking to the site. From the stats, you can make out that 90-95% are free-riders.Official ValuePickr Portfoliowas started to bring in the first level of transparency and accountability.
5). We have NOW been advised to bring inhigherstandards ofTransparency&Accountabilitywhich will lead to higherCredibilitynot only of ValuePickr as a community, but lead to higher credibility of its mostprolific contributors. Separating the Wheat from the Chaff- should apply to companies/stocks, but just as well to our prolific contributors.
6). Higher Transparency - Ensure Disclosure of positions while initiating, on regular updates and definitely on exits, or atleast immediately after. Moderators are responsible for compliance by following up with prolific contributors.
7). Higher Accountability - Track record of prolific recommenders must be kept updated. Initiation price, price behaviour within 3 months, 6 months, 1 yr, 2yr, exit calls, price behaviour post exit calls.
8). Our friends from the Regulatory side say these measures will go a long way in ensuring that the downsides to small investors are minimal, and enhance the reputation of our community if we can start with strictly enforcing these measures.
9). They have also advised us to HELP the Regulators - by putting up profiles of participants, everyone’s photo is uploaded, introductory thread started, and one-on-one face to face group meetings are encouraged.
Many of these we have implemented. Some we are yet to enforce. We are attempting to build on the progress made so far. As a first step, we listprolific participants who we need to bring in within the CIRCLE of TRUST!
This will help Admin keep track and PUSH Team ValuePickr in enhancing its credibility in the investment community.