ShareSoc Launches AIM Company Rating System

PRESS RELEASE 41 (26/11/2012)

ShareSoc has been concerned for some time with the quality of companies on AIM. Private investors often get sucked into investing in companies with poor corporate governance, poor basic infrastructure, no track record, and with incompetent or untrustworthy directors. New AIM IPOs are particularly problematic with companies frequently failing or subsequently delisting. But how can investors sort the wheat from the chaff?

ShareSoc has devised a simple tool to help investors differentiate between good companies and those that are more questionable. It is a check list of 47 questions of readily available information and aims to summarise in a single score various aspects of how shareholder friendly the company is, the corporate governance, director remuneration policies, legal and regulatory problems and other aspects that investors might need to examine.

But it is not a black and white rating system – it only provides a relative quality score and no AIM company is likely to tick all the boxes. It’s the boxes that are not ticked that the investor needs to consider and judge whether that is of concern (although ShareSoc suggests that the items being scored are all important).

ShareSoc Chairman Roger Lawson had this to say about the new system: “No doubt we will be criticised for introducing the ultimate ‘box ticking’ corporate rating system, but investors in the AIM market urgently need a simple tool to help them focus on the quality of companies. We hope that promotion of this standard will help to improve the choices that AIM company directors and their promoters, brokers and Nomads decide to make. We have covered the problems in AIM companies in our past newsletters and met with staff of the LSE on the subject, but with no positive results as yet. Although some AIM companies have been enormously profitable for investors, many have not. If reform cannot be achieved by regulation and better corporate governance standards, then investors have to try and persuade companies more directly or avoid the ones that are likely to disappoint in due course.”

More Information

Note that the system is not designed to give buy or sell recommendations on companies and is not a substitute for full financial analysis and other due diligence that investors should perform before they invest in a company. But it’s interesting to mention the scores that resulted when we rated two companies which ShareSoc has commented on in the past. These are Intercede (which ShareSoc has criticised for its pay arrangements, lack of a Non-Executive Chairman and shortage of independent Non-Executive directors) and Lo-Q which is a popular AIM company among private investors. Intercede scored positive ticks on 53% of questions and Lo-Q scored 85% – clearly a major differentiation. Note that we will not be disclosing the details of the scoring because some of the answers are subjective and may vary over time – this is not a recommendation to buy or sell the shares in those companies.

The rating system is available to anyone on the ShareSoc web site here: www.sharesoc.org/scorecard.html ) so you can rate any company in about 30 minutes yourself. We welcome feedback on the new system, and ShareSoc may use it when reviewing AIM companies in future. Other organisations who report on AIM companies are also welcome to use it so long as they give an acknowledgement of the source.

For further information, please contact:

Roger W. Lawson,
Chairman,
ShareSoc Telephone: 020-8467-2686
Email: info@sharesoc.org

Note any members of the press who wish to receive a complimentary copy of our informative monthly newsletter should send a request to info@sharesoc.org . Our newsletters cover not just the affairs of our organisation but contain general financial news and commentary. An example of our past newsletters is available on our web site. You can also follow ShareSoc on Twitter from @ShareSocUK.

About the UK Individual Shareholders Society (ShareSoc)

ShareSoc represents and supports individual investors who invest in the UK stock markets (and who own as much as 30% of the shares in UK public companies in aggregate). We are a mutual association controlled by our members with “not-for-profit” articles and incorporated as a company limited by guarantee. The organisation is financed by member subscriptions, donations from supporters and by the services it provides to members. Associate Membership of ShareSoc is free and is open to everyone with an interest in stock market investment. More information on ShareSoc can be obtained from our web site at www.sharesoc.org .

Post Date: November 26, 2012

Group description:	All levels of experience welcome. A typical meeting agenda includes: – Macro Environment – Trades: Members review existing positions and identify securities with promising TA entry patterns or setups and with suitable risk/reward. Any security, long, short, futures, options may be considered. The convener takes actual positions in trades and maintains his own detailed ledger, accurately measuring performance of individual securities and cumulative activity. Members are notified by e-mail prior to the entries or exits that are decided upon. Following each meeting an updated copy of the ledger is circulated together with the next meeting agenda. Members may wish to maintain similar ledgers of their own but there is no obligation to do so. – Technical Analysis: Techniques and systems used in trades. Members can request discussion of particular aspects of TA.
Meeting Type/Venue:	Online via Zoom
Meeting Frequency/Timing:	The first Tuesday of every month from 7 to 9pm

Group description:	Following the launch of the SIGnet Technical Traders groups, it was identified that there were a number of members who use fundamental and other information as their main source of choosing companies to invest in, who would find some understanding of technical analysis helpful to identify good entry and exit points for their investments. This new SIGnet Technical Analysis in Support of Investing group is therefore being launched and we welcome members of all levels of experience to join.
Meeting Type/Venue:	Online via Zoom
Meeting Frequency/Timing:	There will be an initial Zoom meeting on Monday 29th April at 7pm to launch this group, please email info@sharesoc.org if you are interested in joining.

Group description:	A new in person group coming soon! Keep and eye on our Events page to register for the launch meeting.
Meeting Type/Venue:	In person
Meeting Frequency/Timing:	TBC

Group description:	Open to all investors / people with an interest in investing. Typical meeting will involve members talking about recent purchases, successes, failures and possible future purchases. Also with occasional visiting speakers or members making presentations on a topic of interest.
Meeting Type/Venue:	We aim to meet on the last Tuesday of each month in a private room at a pub in Playhatch. Start time 7pm with members encouraged to meet up around 6pm for a bite to eat / drink before hand, if their diaries allow.
Meeting Frequency/Timing:	7pm on the last Tuesday of the month. Meetings likely to last about two hours but with informal ‘overspill’ before / after.

Group description:	This group was set up as a forum to discuss companies in detail, each company is introduced by a member and discussion may last one or two hours. Membership is by invitation only and is for experienced investors.
Meeting Type/Venue:	The group meets at a venue in Waterloo, London.
Meeting Frequency/Timing:	Meetings are on Tuesday mornings at two month intervals.

Group description:	Our group members have wide ranging investment experience and work backgrounds. Discussion topics include reviewing our recent stock or collective investment buying and selling activity, plus what we are considering buying or selling and the reasons for our decisions. We also have a wider discussion on where we think opportunities might arise in the next few months and what we think needs to be avoided. Members occasionally lead discussions on specific topics such as recent events attended, articles or books of interest and sources of investment ideas and information.
Meeting Type/Venue:	During the pandemic our meetings were held on Zoom, but we have now resumed meeting in person at a location a few miles to the west of Colchester. Most meetings will now be in person, but it is possible that occasional meetings will be held on Zoom in special circumstances.
Meeting Frequency/Timing:	We meet midweek every two months. Zoom meetings run for about two hours from 10.30am and in person meetings from 11am until about 3pm, including a break for lunch.

Group description:	Our group is a broad church that contains investors of varying age and experience. We discuss stocks and investment trusts that we have bought, sold or are interested in and the reasons behind our decisions, and try to make sense of the ever changing investment environment. Our members backgrounds are diverse and include corporate banking, engineering, teaching and the leisure industry. Discussions are robust and challenging but tend to be to be informal, and do not generally involve agendas, presentations or detailed preparation. We are a friendly and approachable group who welcome investors of all levels – we just ask that you contribute, at whatever level you can.
Meeting Type/Venue:	Our meetings are held in a very nice pub near to South Ealing tube station (Piccadilly Line), not far from Ealing Broadway (District, Central and Elizabeth Line). Group numbers permitting (and assuming members are happy to purchase food and drink from the bar), we may also have access to a private room in the pub.
Meeting Frequency/Timing:	We meet every 2 months, usually on a Wednesday morning at 11am.

Group description:	Group focused on active investing, primarily in small / medium cap UK equities.
Meeting Type/Venue:	Regular Zoom meetings interspersed with occasional face to face meetings and social activities in the North West.
Meeting Frequency/Timing:	Monthly on Saturdays at 10am.

Group description:	Our group covers a wide spectrum of mainly stock market investing and trading from equities – which include shares, ETF’s Investment and Unit Trusts. We normally rotate the meeting chairperson (responsible for creating, with member’s help, suitable agendas) and a meeting presenter (members take it in turns to provide a 15 to 45 minute presentation on a subject of their choice). Various investing topics of interest are regularly discussed such as software, brokers, investing categories and markets and any related topics of interest.
Meeting Type/Venue:	Meetings will be returning to in-person in a private room at a West London golf club, close to an underground station. In the meantime monthly video calls and an in-between meeting email group will continue.
Meeting Frequency/Timing:	In-person meetings will be held on the second Wednesday of each month in the afternoons, following a golf club one course lunch.

ShareSoc Launches AIM Company Rating System

PRESS RELEASE 41 (26/11/2012)

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