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Portfolio123 » List all forums » Forum: General Comments » Thread: BLOG: Reverse Takeover Companies: Love Them, Hate Them, Find Them |
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Total posts in this thread: 4 |
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mgerstein
Advanced Member
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EXCERPT The just-introduced Portfolio123 Country function opens up an interesting new set of screening opportunities. You can now easily find, or eliminate one of the most interesting or dangerous (depending on your point of view) groups of companies in the market today: the reverse takeover (RTO) firms. FULL ARTICLE. BY: Marc Gerstein CATEGORY: Idea Lab |
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Chipper6
Advanced Member
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Thanks Marc for a very informative article. I have to disagree with one thing, though. The level of fraud in China is much worse than in the US. Even Enron really had employees. On the other hand, many Chinese companies have no business and no employees but just make up numbers. I hear from people who are paid to inspect the factories of Chinese companies that while they are busy checking one corner of the plant, Chinese workers secretly switch the products in the other end of the plant. This rarely happens in the USA. In the US, people consider honesty and integrity a virtue. We look up to people who have integrity. I suspect that this is in large part because of the influence of the Bible. The culture in China, however, does not seem to hold integrity in high esteem. If you know what to look for, you can examine the documents of US companies, even nano caps, and know with some degree of confidence that the cash in the bank is legit. With Chinese companies I have no way to tell. There will come a point that the Chinese companies themselves will look for a way to prove that they are honest--if for no other reason than to give people the confidence to invest in them. |
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jskverer
Advanced Member
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I just ran a test of my three live portfolios for one year and five year periods. When I used the filter EVAL(Country("CHN"),Universe($ADR)=true,mktcap>=0) to eliminate Chinese RTO's, the average yearly improvement in returns was approximately 4%. After losing a couple of times because of Chinese fraud, I have had enough. I have just added this filter to all of my live portfolios. Thanks for the excellent article. Greetings, Jorge |
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craig
Advanced Member
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Great filter! I tried the China filter on several of my simulations. It increased the return from very little to very much. Thanks for the suggestions. Jeff |
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