Is all that glitters gold? A look at Fortune magazine’s 100 Fastest-Growing Companies

2019 ◽  
Vol 45 (7) ◽  
pp. 827-841
Author(s):  
Anthony Thomas Garcia ◽  
Anthony Loviscek ◽  
Kangzhen Xie
Keyword(s):  
Information Content ◽  
Performance Metrics ◽  
Editorial Staff ◽  
Selection Strategy ◽  
Portfolio Performance ◽  
Stock Selection ◽  
Significant Information ◽  
Content Type ◽  
Stock Portfolios ◽  
S 100

Purpose Does Fortune magazine’s list of the 100 Fastest-Growing Companies have information content; that is, is the list a source for market-beating performance? The paper aims to discuss this issue. Design/methodology/approach Using data for 26 annual periods, 1991–2016, the paper examines the top 5, 10, 25, 50 and all 100 stocks on a return-risk basis, including an application of Modern Portfolio Theory. To generate portfolio performance metrics, the study uses conventional mean-variance analysis, which includes the estimation of returns and risks, where risk will be measured by standard deviation and β. To arrive at the performance metrics and to determine whether information content is embedded in the list, the study reviews a series of tests. Because Fortune ranks the companies from 1 to 100, the data can be used to test if information content is displayed in sub-groups, such as in the first five to ten companies, even if it does not exist in the 100-stock portfolios. Findings The study finds that the returns are not high enough nor are the risks low enough statistically to conclude the existence of significant information content. Research limitations/implications As part of the authors’ efforts to move to the population of 2,600 firms as closely as possible, the authors use “delisting” returns from CRSP on 120 firms to account for missing observations, with a final sample size of 2,594 firms. Practical implications The evidence indicates that investors drawn to Fortune’s “100 Fastest-Growing Companies” should view them skeptically as a source for an effective stock selection strategy. Originality/value On the basis of the results of this study, readers will conclude that subscribers drawn to Fortune’s “100 Fastest-Growing Companies” should view them skeptically for investment recommendations. From a portfolio perspective, the study is unable to uncover information content that could lead to a market-beating performance, suggesting that the published criteria Fortune uses to select the Fastest-Growing Companies is embedded in the prices of the stocks even before Fortune publishes its list. The study notes that the selection criteria used by Fortune do involve some judgments on the part of the editorial staff (e.g. whether an announced restatement of previously reported financial data appears to have a significant impact), which means that someone who wished to anticipate the publication of the next list of the “Fastest-Growing Companies” would not only have to gather information but would also have to correctly anticipate these judgment calls.

scholarly journals Discovering optimal weights in weighted-scoring stock-picking models: a mixture design approach

2020 ◽  
Vol 6 (1) ◽  
Author(s):  
I-Cheng Yeh ◽  
Yi-Cheng Liu
Keyword(s):  
Performance Prediction ◽  
Prediction Models ◽  
Optimization Techniques ◽  
Optimal Combination ◽  
Portfolio Performance ◽  
Stock Selection ◽  
Optimal Weights ◽  
Stock Portfolios ◽  
Predicting Performance ◽  
Stock Picking

AbstractCertain literature that constructs a multifactor stock selection model adopted a weighted-scoring approach despite its three shortcomings. First, it cannot effectively identify the connection between the weights of stock-picking concepts and portfolio performances. Second, it cannot provide stock-picking concepts’ optimal combination of weights. Third, it cannot meet various investor preferences. Thus, this study employs a mixture experimental design to determine the weights of stock-picking concepts, collect portfolio performance data, and construct performance prediction models based on the weights of stock-picking concepts. Furthermore, these performance prediction models and optimization techniques are employed to discover stock-picking concepts’ optimal combination of weights that meet investor preferences. The samples consist of stocks listed on the Taiwan stock market. The modeling and testing periods were 1997–2008 and 2009–2015, respectively. Empirical evidence showed (1) that our methodology is robust in predicting performance accurately, (2) that it can identify significant interactions between stock-picking concepts’ weights, and (3) that which their optimal combination should be. This combination of weights can form stock portfolios with the best performances that can meet investor preferences. Thus, our methodology can fill the three drawbacks of the classical weighted-scoring approach.

A DECISION TREE-BASED CLASSIFICATION APPROACH TO RULE EXTRACTION FOR SECURITY ANALYSIS

2006 ◽  
Vol 05 (01) ◽  
pp. 227-240 ◽  
Author(s):  
N. REN ◽  
M. ZARGHAM ◽  
S. RAHIMI
Keyword(s):  
Decision Tree ◽  
High Performance ◽  
Security Analysis ◽  
Predictive Performance ◽  
Classification Model ◽  
Stock Selection ◽  
Selection Rules ◽  
Stock Portfolios ◽  
Decision Tree Classification ◽  
C4.5 Decision Tree

Stock selection rules are extensively utilized as the guideline to construct high performance stock portfolios. However, the predictive performance of the rules developed by some economic experts in the past has decreased dramatically for the current stock market. In this paper, C4.5 decision tree classification method was adopted to construct a model for stock prediction based on the fundamental stock data, from which a set of stock selection rules was derived. The experimental results showed that the generated rules have exceptional predictive performance. Moreover, it also demonstrated that the C4.5 decision tree classification model can work efficiently on the high noise stock data domain.

On portfolio optimization

2016 ◽  
Vol 17 (3) ◽  
pp. 295-309 ◽  
Author(s):  
Theo Berger ◽  
Christian Fieberg
Keyword(s):  
Minimum Variance ◽  
Factor Models ◽  
Scale Factor ◽  
Covariance Matrices ◽  
Portfolio Performance ◽  
Content Type ◽  
Portfolio Decisions ◽  
Multi Scale ◽  
Out Of Sample ◽  
Factor Returns

Purpose The purpose of this paper is to show how investors can incorporate the multi-scale nature of asset and factor returns into their portfolio decisions and to evaluate the out-of-sample performance of such strategies. Design/methodology/approach The authors decompose daily return series of common risk factors and of all stocks listed in the Dow Jones Industrial Index (DJI) from 2000 to 2015 into different time scales to separate short-term noise from long-run trends. Then, the authors apply various (multi-scale) factor models to determine variance-covariance matrices which are used for minimum variance portfolio selection. Finally, the portfolios are evaluated by their out-of-sample performance. Findings The authors find that portfolios which are constructed on variance-covariance matrices stemming from multi-scale factor models outperform portfolio allocations which do not take the multi-scale nature of asset and factor returns into account. Practical implications The results of this paper provide evidence that accounting for the multi-scale nature of return distributions in portfolio decisions might be a promising approach from a portfolio performance perspective. Originality/value The authors demonstrate how investors can incorporate the multi-scale nature of returns into their portfolio decisions by applying wavelet filter techniques.

Research on user needs for mobile information services in Chinese university libraries

2016 ◽  
Vol 34 (4) ◽  
pp. 617-635 ◽  
Author(s):  
Yang Zhao ◽  
Shengli Deng ◽  
Ting Gao ◽  
Ruoxin Zhou
Keyword(s):  
Information Content ◽  
Mobile Services ◽  
Information Services ◽  
User Needs ◽  
University Libraries ◽  
Content Type ◽  
Mobile Information ◽  
User Groups ◽  
Mobile Information Services

Purpose This paper aims to investigate the service demand of existing users and potential users for mobile information services provided by university libraries in China. The primary objective is to explore the impact of user experience on user needs, which is conducted by a comparison between two user groups over their needs from three aspects – service function, service mode and information content. Design/methodology/approach Data were collected from 353 library users from ten Chinese universities via questionnaires. Based on the user needs model, three dimensions of user needs were established for mobile information services and 26 measurement items were generated through a review of the literature. Furthermore, based on frequency analysis, independent samples t-test and the calculation of need rate, the demand differences in mobile information services between existing and potential users were explored. Findings Significant differences existed in the needs for service functions and service modes of mobile information services between existing users and potential users. Existing users cared more about such characteristics as intelligence, personalization and the variety of mobile services. Potential users, in contrast, concerned themselves more with the usability of mobile services and similarity to traditional information services. These two user groups showed little difference in the needs for information content, as they both have strict requirements for specialty, richness in and quality of information resources in mobile network environments. Originality/value Previous research on user needs for mobile libraries services has been primarily conducted from the perspectives of existing users. This study, however, compared the needs of existing and potential users based on their previous experiences, which can help libraries to know better what their users need and improve the quality of mobile information services to meet those needs. This can also make existing users more willing to use the services and cultivate the usage habits of potential users at the same time.

An experimental study on feature-based SLAM for multi-legged robots with RGB-D sensors

2017 ◽  
Vol 44 (4) ◽  
pp. 428-441 ◽  
Author(s):  
Michał R. Nowicki ◽  
Dominik Belter ◽  
Aleksander Kostusiak ◽  
Petr Cížek ◽  
Jan Faigl ◽  
...  
Keyword(s):  
Performance Metrics ◽  
State Of The Art ◽  
Building Blocks ◽  
Bundle Adjustment ◽  
The State ◽  
Legged Robots ◽  
Evaluation Methodology ◽  
Walking Robots ◽  
Content Type ◽  
Feature Based

Purpose This paper aims to evaluate four different simultaneous localization and mapping (SLAM) systems in the context of localization of multi-legged walking robots equipped with compact RGB-D sensors. This paper identifies problems related to in-motion data acquisition in a legged robot and evaluates the particular building blocks and concepts applied in contemporary SLAM systems against these problems. The SLAM systems are evaluated on two independent experimental set-ups, applying a well-established methodology and performance metrics. Design/methodology/approach Four feature-based SLAM architectures are evaluated with respect to their suitability for localization of multi-legged walking robots. The evaluation methodology is based on the computation of the absolute trajectory error (ATE) and relative pose error (RPE), which are performance metrics well-established in the robotics community. Four sequences of RGB-D frames acquired in two independent experiments using two different six-legged walking robots are used in the evaluation process. Findings The experiments revealed that the predominant problem characteristics of the legged robots as platforms for SLAM are the abrupt and unpredictable sensor motions, as well as oscillations and vibrations, which corrupt the images captured in-motion. The tested adaptive gait allowed the evaluated SLAM systems to reconstruct proper trajectories. The bundle adjustment-based SLAM systems produced best results, thanks to the use of a map, which enables to establish a large number of constraints for the estimated trajectory. Research limitations/implications The evaluation was performed using indoor mockups of terrain. Experiments in more natural and challenging environments are envisioned as part of future research. Practical implications The lack of accurate self-localization methods is considered as one of the most important limitations of walking robots. Thus, the evaluation of the state-of-the-art SLAM methods on legged platforms may be useful for all researchers working on walking robots’ autonomy and their use in various applications, such as search, security, agriculture and mining. Originality/value The main contribution lies in the integration of the state-of-the-art SLAM methods on walking robots and their thorough experimental evaluation using a well-established methodology. Moreover, a SLAM system designed especially for RGB-D sensors and real-world applications is presented in details.

Portfolio revision and optimal diversification strategy choices

2014 ◽  
Vol 10 (4) ◽  
pp. 537-564
Author(s):  
Mourad Mroua ◽  
Fathi Abid
Keyword(s):  
Transaction Costs ◽  
Tracking Error ◽  
Investment Strategy ◽  
Selection Strategy ◽  
Revision Procedure ◽  
Content Type ◽  
Efficient Frontiers ◽  
Statistical Inferences ◽  
Diversification Strategies ◽  
International Portfolios

Purpose – Since equity markets have a dynamic nature, the purpose of this paper is to investigate the performance of a revision procedure for domestic and international portfolios, and provides an empirical selection strategy for optimal diversification from an American investor's point of view. This paper considers the impact of estimation errors on the optimization processes in financial portfolios. Design/methodology/approach – This paper introduces the concept of portfolio resampling using Monte Carlo method. Statistical inferences methodology is applied to construct the sample acceptance regions and confidence regions for the resampled portfolios needing revision. Tracking error variance minimization (TEVM) problem is used to define the tracking error efficient frontiers (TEEF) referring to Roll (1992). This paper employs a computation method of the periodical after revision return performance level of the dynamic diversification strategies considering the transaction cost. Findings – The main finding is that the global portfolio diversification benefits exist for the domestic investors, in both the mean-variance and tracking error analysis. Through TEEF, the dynamic analysis indicates that domestic dynamic diversification outperforms international major and emerging diversification strategies. Portfolio revision appears to be of no systematic benefit. Depending on the revision of the weights of the assets in the portfolio and the transaction costs, the revision policy can negatively affect the performance of an investment strategy. Considering the transaction costs of portfolios revision, the results of the return performance computation suggest the dominance of the global and the international emerging markets diversification over all other strategies. Finally, an assessment between the return and the cost of the portfolios revision strategy is necessary. Originality/value – The innovation of this paper is to introduce a new concept of the dynamic portfolio management by considering the transaction costs. This paper investigates the performance of a revision procedure for domestic and international portfolios and provides an empirical selection strategy for optimal diversification. The originality of the idea consists on the application of a new statistical inferences methodology to define portfolios needing revision and the use of the TEVM algorithm to define the tracking error dynamic efficient frontiers.

Research of Building Intelligent Investment Decision Mode for Investment Portfolio — Using Taiwan Electronic Stock as an Example

2010 ◽  
Vol 13 (04) ◽  
pp. 621-645 ◽  
Author(s):  
Wen-Rong Jerry Ho ◽  
C. H. Liu ◽  
H. W. Chen
Keyword(s):  
Stock Returns ◽  
Stock Prices ◽  
Stock Exchange ◽  
Investment Decision ◽  
Investment Strategy ◽  
Return Rate ◽  
Selection Strategy ◽  
Stock Selection ◽  
Taiwan Stock Exchange ◽  
Book To Market Ratio

This research uses all of the listed electronic stocks in the Taiwan Stock Exchange as a sample to test the performance of the return rate of stock prices. In addition, this research compares it with the electronic stock returns. The empirical result shows that no matter which kind of stock selection strategy we choose, a majority of the return rate is higher than that of the electronics index. Evident in the results, the predicted effect of BPNN is better than that of the general average decentralized investment strategy. Furthermore, the low price-to-earning ratio and the low book-to-market ratio have a significant long-term influence.

Hybridization as practice: clinical engagement with performance metrics and accounting technologies in the English NHS

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Christos Begkos ◽  
Katerina Antonopoulou
Keyword(s):  
Performance Measurement ◽  
Performance Metrics ◽  
Healthcare Setting ◽  
Business Managers ◽  
Structured Interviews ◽  
Content Type ◽  
Professional Boundaries ◽  
Care Outcomes ◽  
And Performance ◽  
Clinical Engagement

PurposeThis study aims to investigate the hybridization practices that medical managers engage with to promote accounting and performance measurement in the hybrid setting of healthcare. In doing so, the authors explore how medical managers enact and become practitioners of hybridity.Design/methodology/approachThe authors adopt a practice lens to conceptualize hybridization as an emergent, situated practice and capture the micro-activities that medical managers engage with when they enact hybridity. The authors conducted semi-structured interviews with medical managers, business managers and coding professionals and collected documents at an English National Health Service (NHS) hospital over the course of five years.FindingsThe findings accentuate two emergent practices through which medical managers instill hybridity to individuals who are hesitant or resistant to hybridization. Medical managers engage in equivocalizing and de-stigmatizing practices to broaden the understandings, further diversify or reconcile the teleologies of clinicians in non-managerial roles. In doing so, the authors signal the merits of accounting in improving care outcomes and remove the stigma associated to clinical engagement with costs.Originality/valueThe study contributes to hybridization and practice theory literature via capturing how hybridity is enacted in practice in a healthcare setting. As medical managers engage with and promote accounting information and performance measurement technologies in their practice environment, they transcend professional boundaries and hybridize the professional spaces that surround them.

Employees as a vector of strategic intent: an examination of corporate, social and environmental strategic intent recognition by employees

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Pat Auger ◽  
Timothy M. Devinney ◽  
Grahame Dowling
Keyword(s):  
Decision Making ◽  
Environmental Sustainability ◽  
Corporate Strategy ◽  
Performance Metrics ◽  
Methodological Approach ◽  
Environmental Strategy ◽  
Content Type ◽  
Strategic Intent ◽  
Csr Strategy ◽  
Corporate Social

PurposeOne of the hallmarks of strategizing is having a clearly articulated vision and mission for the organization. It has been suggested that this provides a compass bearing for the organization's strategy, helps in motivation, commitment and retention of employees, serves as a guide to internal sensemaking and decision-making, has a potential performance effect, helps establish the identity of the organization and positions its desired reputation. The compass bearing role is important because it guides the selection of the goals and strategic orientation of the organization which in turn shapes its overall strategy and much of its internal decision making. The inspirational role is important because it helps to motivate and engage employees and other stakeholders.Design/methodology/approachThis study provides a more rigorous indication as to whether employees can, in the first instance, recognize and distinguish their corporate and environmental strategy from that of their competitors within their own industry and random other companies from other industries. This first issue addresses, to a degree, if and why, such strategic communiqués are effective inside a range of different organizations. Secondly, the authors examine whether there are any specific individual level effects that could explain variations in these responses. Finally, the authors examine the extent to which the recognition rates the authors observe, relate to how employees are rewarded through appraisals, promotions and salary increases. This helps in the authors’ understanding of the role of hard incentives versus soft motivations. The authors’ approach to assessing employee knowledge of their organization's strategy is unique. Rather than survey employees about their knowledge, the authors use a matching study and a discrete choice measurement model to assess if they can recognize their organization's strategy from those of their competitors and some other randomly selected organizations. This approach allows us to mitigate social desirability and common method biases and directly estimate the underlying behavioral model being used to assess their organization's strategy.FindingsOverall, the authors found that few employees could correctly identify their corporate strategy statements. In the case of corporate strategy statements, the authors find that, on average, only 29 percent of employees could correctly match their company to its publicly espoused corporate strategy. When the authors look at the environmental sustainability strategy of the firm, this is worse overall, with individuals doing no better than random on average. When the authors look at company training and communication practices across the realm of different strategies, the authors see a number of factors leading to the general results. First, most of the authors’ respondents could not recall a significant effort being given to communication and training by their employer. Indeed, most communication/training is simply related to having documentation/brochures available. Second, respondents indicated that more effort is put into communicating corporate strategy to employees in a more systematic manner than communication about environmental/corporate social responsible (CSR) strategy. Third, the authors see that individuals are evaluated more on and give more weight to, evaluations relating to their ability to meet individual/group financial and market performance metrics (targets) and work as a team than their involvement in environmental and social responsibility programs. Finally, the employees studied seemed to be more confident in understanding the corporate strategy. When asked to put their corporate strategy into words – a task the authors asked respondents to do after the matching phase of the study – 40% of participants did so for the corporate strategy but only 14% did so for the environmental strategy and seven percent for the CSR strategy.Practical implicationsThe primary implication of the study is that the values-mission-strategy logic of strategic motivation seems to have limited validity and with respect to the view that employees are a vector of corporate strategy. It is hard to argue that employees can be a vector for something they cannot recall or even distinguish between.Originality/valueThe study is unique in terms of (1) asking the very simple question of whether employees internalize their company's strategies and (2) in the methodological approach to examine employee knowledge and informativeness.

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