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The Long-Term Stock Exchange Opens for Business

blog.ltse.com

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Re: The Long-Term Stock Exchange Opens for Business

#71

Post by pmart123 »

SamBam wrote: post #9
picodguyo wrote: post #3

"They described the immense pressure on companies to pursue short-term results over creating value for future decades and generations." Where does this pressure come from? The board? Can't you appoint a board that is long-term friendly? Institutional investors? Wouldn't the same investors interested in the LTSE also be interested in you on the traditional market if long-term is part of your DNA? Shareholders? Shareho…

Yes, I feel like more of an explanation is required. Investors in existing exchanges already understand the different metrics companies might be categorized under -- value vs growth, for example -- and this seems like "extra-long-term value." But does that require a new exchange, or just a new valuation for companies? How about an index fund that invests only in such companies? I would probably invest in a "Vanguard…

In Europe, companies like LVMH and L'Oreal has bonus dividends or extra voting rights for long-term institutional shareholders already. Essentially, if you hold onto shares for over 1 year, 2 years, etc., you can offer shareholders additional incentives.

Re: The Long-Term Stock Exchange Opens for Business

#72

Post by pbhjpbhj »

LatteLazy wrote: post #52
BiteCode_dev wrote: post #40

Genuine question, what good does the ability to buy and sell stock on the short term do for humanity ? Does it have any specific vertue appart from allowing one to make make money by betting correctly ? Why are not all sales required to be long term ?

It prevents capital being mis-allocated. It turns out that is one of the most important things to do in modern, capital intensive, economies. It also means people can invest for shorter periods and that means more capital is available for investment. This has a double bonus where it reduces the risk of investments again making more capital available...

It seems just to soak away capital to third parties and not prevent misallocation any more than longer-term trading would?

Compare football (ie soccer) trading windows. Player performance within a match might be like daily performance of a company.

Re: The Long-Term Stock Exchange Opens for Business

#74

Post by codeulike »

lr wrote: post #61

Just throwing this out there... Why not a simple rule to require all shares to be held for at least 24 hours before selling? It would certainly change the game in every way imaginable.

It would but powerful vested interests would probably fight it tooth and nail. See https://en.wikipedia.org/wiki/Tobin_tax

Re: The Long-Term Stock Exchange Opens for Business

#75

Post by rectang »

picodguyo wrote: post #3

"They described the immense pressure on companies to pursue short-term results over creating value for future decades and generations." Where does this pressure come from? The board? Can't you appoint a board that is long-term friendly? Institutional investors? Wouldn't the same investors interested in the LTSE also be interested in you on the traditional market if long-term is part of your DNA? Shareholders? Shareho…

> Maybe others can elaborate on what problem is being solved here.

I found these two URLs helpful in understanding how LTSE sees its role:

https://www.ltse.com/faq

> Q. Would companies that list on the Long-Term Stock Exchange report quarterly earnings?

> A. Yes. By law, U.S. public companies are required to report earnings at least quarterly. The difference is that the listing standards of the Long-Term Stock Exchange are designed to change the narrative for success, so that the quarterly results are viewed in context as part of a long-term narrative.

https://longtermstockexchange.com/listings/principles/

> Long-term focused companies should consider a broader group of stakeholders and the critical role they play in one another’s success.

The focus seems to be less on constraints on traders and trading, and more on policies that companies listed on the exchange must fulfill. So the LTSE doesn't have to be the exclusive venue for trading and a company can be dual-listed on LTSE and another exchange — the mere fact that the company is listed on the LTSE gives you a crucial piece of information.

Re: The Long-Term Stock Exchange Opens for Business

#77

Post by dionian »

mikepurvis wrote: post #63
pbhjpbhj wrote: post #56

Earlier quoted context omitted.

Forgive me for straying OT: It seems like a fact-based analogy. 'A group have been restrained to "territory", but a member has broken that restraint'. There doesn't seem inherently to be a judgement as to the restraint or the rogue being right/wrong. I'd be interested in why you felt the usage was beyond the pale sufficiently that it needed to be reined in? The concept of territorial reservations doesn't appear to me…

Not the parent, but it's obvious what the origin of the phrase is, and while it may not be as icky as something like "open the kimono", it's definitely one that is trivially replaced with no loss in meaning, and therefore almost certainly should be: "The issue with 'off the reservation' and similar phrases is that these things are said without any thought. They become a part of the common vernacular. Freely they move…

We can also listen to the phrase without imputing immoral motives to the speaker.

Re: The Long-Term Stock Exchange Opens for Business

#78

Post by jayd16 »

mikepurvis wrote: post #63
pbhjpbhj wrote: post #56

Earlier quoted context omitted.

Forgive me for straying OT: It seems like a fact-based analogy. 'A group have been restrained to "territory", but a member has broken that restraint'. There doesn't seem inherently to be a judgement as to the restraint or the rogue being right/wrong. I'd be interested in why you felt the usage was beyond the pale sufficiently that it needed to be reined in? The concept of territorial reservations doesn't appear to me…

Not the parent, but it's obvious what the origin of the phrase is, and while it may not be as icky as something like "open the kimono", it's definitely one that is trivially replaced with no loss in meaning, and therefore almost certainly should be: "The issue with 'off the reservation' and similar phrases is that these things are said without any thought. They become a part of the common vernacular. Freely they move…

Is there some pejorative meaning to opening the kimono or is it just mildly lewd?

Re: The Long-Term Stock Exchange Opens for Business

#79

Post by superqd »

Hmmm, a bit disappointed after reading their blog and site. I expected that they'd integrated some clever rules around stock trading itself in order to force, or encourage, long term thinking. I expected something along the lines of, "no shorting allowed", "stocks must be held a minimum of 6 months", etc. There was nothing like that, all they have is the rule, "come on guys, think long term".

I fail to see how this will have any meaningful effect on "long term vision", if they still allow your stock price to be dumped at the first sign of trouble, or allow people to bet against your company when some irrelevant bad news hits, or no one else sees value when you decide to deepen your spend on R&D for some long term plan. If people freak out, or think they can profit off of your lack of current obvious value, the you are still going to have short term fluctuations that you will feel pressured to address.

The problem with short term thinking isn't from companies or company leadership, they are reacting to the natural short term fluctuations in their value because of the short term thinking of investors. Shareholders are not gonna understand your vision every time you decide to engage in a long term strategic shift in priorities, so they will react when they find out, and that reaction can swiftly damage a company's value. If shareholders can still trade over short-terms, then you will still have large scale short-term fluctuations that CEOs will be forced to address, as more and more potential buyers will be influenced by the low price of a stock caused by other skittish short-term thinking investors.

The problem is with investors in stocks, not with the companies unwillingness to think long term. To make such an exchange work, you have to have clever trading rules in place to force longer term thinking.

Re: The Long-Term Stock Exchange Opens for Business

#80

Post by derivagral »

AznHisoka wrote: post #36
pavlov wrote: post #14

Earlier quoted context omitted.

I don’t get it. There are already plenty of public companies that pay extremely predictable dividends. This is a popular investment type for retirement portfolios, among others. Why should they be on a separate exchange?

The dividend is not based on their cashflow. So if Apple is paying 1% dividend on a $100 stock price, but their cashflows increase every year, they're still paying you $1 every year. What I'm suggesting is an exchange where the dividend is a fixed % of their cashflows. Let's say it's 1%. If their cashflow is 1 billion, then 1% of it goes to their shareholders. If it doubles the next year, then 1% of that 2 billion go…

As I understand it, the dividend is set typically in a dollar amount and the % is a metric derived from that. I agree that the figure is (usually) a bit nonsense. However, I don't think your phrasing is as clear as it could be. If Apple announces a 10% dividend with a 1T market cap that's $100b in distribution. If the market cap doubles to 2T later that year, that dividend payment isn't suddenly updated to $200b; it just shows up as a 5% dividend in your typical metrics.
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