E-trading
Associate Professor Roger Debreceny from the Nanyang Business School in Singapore listed as his five favourite Web sites for investors Coles Myers www.colesmyer.com.au for its good presentation, Lend
Associate Professor Roger Debreceny from the Nanyang Business School in Singapore listed as his five favourite Web sites for investors Coles Myers www.colesmyer.com.au for its good presentation, Lend Leases www.lendlease.com.au as a prime example of Web site design, News Corporations www.newscorp.com.au for the comprehensive nature of the information provided, Norths www.north.com.au for its clean, easy-to-use style, and the German power utility, RWEs www.rwe.de, whose Web site is available in both German and English. Companies that do not report on the Web will not develop as broad and deep a market following as those firms which actively pursue a full and open net-based investor relations strategy, Mr Debreceny said.
Mr Tony McLean, Australian Shareholders Association Executive Director, said the sites of AMP at www.amp.com.au, Coles Myer and David Jones at www.davidjones.com.au passed ASAs test of posting annual reports and company announcements online quickly after their general release to market.
International companies sites such as Microsofts at www.microsoft.com and British Shells at www.shell.co.uk also earned praise from Mr Debreceny.
He said successful investor sites allowed investors to bookmark certain pages, examine company performance at a glance, news releases on latest developments, directors speeches and projections and easily downloadable and printable documents.
Good sites also gave profit and loss sheets that potential share investors could manipulate to see how their share investment would have performed under different circumstances.
Mr Debreceny and Mr McLean said they hoped more companies going online with major announcements would stamp out insider trading, where full-service stockbrokers gained privileged corporate information during briefing sessions or joint conference calls between selected broking firms and company directors.
Mr McLean said it was a continual source of frustration that brokers could access this information and act on it earlier than small investors going through online brokers.
Investors should be demanding to see everything that is released in print at the same time it is released to the market in a form that is easy to use, and investors should demand to see any information released in analyst briefings or in other private communications to analysts, Mr Debreceny said.
He added that some companies share prices showed irregular trading patterns at times when company directors were briefing brokers and analysts on their future plans, suggesting that brokers may be trading on the strength of what was being said during the phone link-up itself. In America Intel has ensured equal access to company information by broadcasting its shareholder meetings at www.intel.com, and Telecom New Zealand provided full details of the its takeover bids for AAPT on its site at www.telecom.co.nz as the bids unfolded. But Mr Debreceny also warned investors not to believe everything on company Web sites. Computershare Analytics report found, for example, that about five per cent of online companies provided broking analyst reports, but these were heavily biased toward strong buy, buy or accumulate recommendations.
Mr Roland Helene, HarvestTheNets director, said investors should tread carefully with analysts reports posted on company Web sites, and not immediately assume that just because the company has placed them on its Web site that it is endorsing the analysts forecasts.
Mr Debreceny said that investors should ask themselves some fundamental questions when perusing the Web sites of companies whose shares they considered buying.
Such questions included:
* Do the independent auditors reports come with authenticated signatures?
* Which online information was included in the audit?
* Do I bear legal responsibility for acting on this online data if I trust in its reliability?
* Can I compare this companys performance this year with last
years figures?
* If I am reading a translated set of financials, has the auditor sighted them as well?
* Can I download the information I need easily?
This article appeared in the April, 2000 issue of PC Authority.
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