Posted by: donmihaihai | May 14, 2017

Dual class shares and quarterly reporting

It is in the news that Singapore Exchange is looking at them and seeking feedbacks. In my own bias and personal views, the direction is correct.

Dual class shares structure is a non- event. It doesn’t matter if the listed company has single or dual class shares, it will still be valued as what it is not what I wish it to be. On a positive note, it will be more fun. Maybe fun is not the word, but more challenging. Something that I welcome.

Saying no to dual class shares is like protecting minority shareholder. Protection or protectionism usual don’t ended well in history. I don’t need this protection. Neither will I cry baby if my investment failed.

Dual class shares also opened up the management. Currently we are trying to fit them into something. What will they do if we don’t? Their choice say a lot about themselves. Of course it will not be like they are good if choose single class share and bad if choose dual class. But we will know more about the management if they are given a choice and I want to know their choice and perhaps the reasons behind.

In the beginning of 2016, someone wrote “for serious investors, if monthly reporting is available, they will vote for it”. Look like I am not a serious investor since I will vote against it.

There are listed companies in SGX where quarterly reporting is not required. Few members of Jardine Group do 6 monthly reporting as they are following rule of their primary listing. Hong Kong Land is one of them. I do not know if  not reporting their financials quarterly cost their share to underperform the market. But you see, I choose to use Jardine Group because their share performances are good. Anyway in short, do I feel short changed? The answer is no. Do I need quarterly reporting to tell me how well the company is doing? The answer is no. I am not running the company.

Practically, I do skip quarterly reporting. It is a choice I made. I don’t need to go through all quarterly reporting of the companies I invested in. I know what kind of numbers I am expecting. But well, I will read them if I want to feel “good” about the company. Other than that, it freed up lot of time for reading annual reports. I have a full time job after all.

 

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