Love the reference to econometrics, an activity which you rightly mention provides valued research between company to company. A small change which I feel is missed in this activity is that information is usually derived from current company financials and results are consolidated to arrive at conclusions such as XYZ is "normal" for this industry due to economic downturn etc.. what is missing however is the extent of the downturn of company A Vs company B.
The inclusion of this data may still position both company's in " Normal " however the downturn of company B is above the average for the industry, whilst company A may be recovering and if growth continues will see a move away from normal to perhaps "good".
Neither Normal or average should be seen in isolation, but utilised to create a more comprehensive "Normal" by means of a north star average. Both however will require historical oversight for this to become reality. A small but relevant change would provide improved information flows for investors.
I'll admit that what you've described above is the next level on from what I'd aimed for in the post - a level of detail that I certainly couldn't match.
What I'm aiming for more in this newsletter is just about the small-changes themselves, and how we can learn to notice them, as a source of insights that can move us into a new direction. We do need that detail, of course - no doubt on that at all - yet without that first shift, we wouldn't get to the point where we recognise the need for that detail, or the need to look for how to find that detail.
Or, in short, people have to start somewhere - and it's getting them to start at all that's often the hard part. :-o :-) Hence the purpose of this newsletter.
Tom your comment " Or, in short, people have to start somewhere " is exactly the point when assessing information consolidation without incremental calibration we assume all companies are the same within a given assessment. A small change to the criteria would enhance the oversight. This applies to any other assessment approach, as they say "the devil is in the detail"
Love the reference to econometrics, an activity which you rightly mention provides valued research between company to company. A small change which I feel is missed in this activity is that information is usually derived from current company financials and results are consolidated to arrive at conclusions such as XYZ is "normal" for this industry due to economic downturn etc.. what is missing however is the extent of the downturn of company A Vs company B.
The inclusion of this data may still position both company's in " Normal " however the downturn of company B is above the average for the industry, whilst company A may be recovering and if growth continues will see a move away from normal to perhaps "good".
Neither Normal or average should be seen in isolation, but utilised to create a more comprehensive "Normal" by means of a north star average. Both however will require historical oversight for this to become reality. A small but relevant change would provide improved information flows for investors.
Thanks for this, Robert!
I'll admit that what you've described above is the next level on from what I'd aimed for in the post - a level of detail that I certainly couldn't match.
What I'm aiming for more in this newsletter is just about the small-changes themselves, and how we can learn to notice them, as a source of insights that can move us into a new direction. We do need that detail, of course - no doubt on that at all - yet without that first shift, we wouldn't get to the point where we recognise the need for that detail, or the need to look for how to find that detail.
Or, in short, people have to start somewhere - and it's getting them to start at all that's often the hard part. :-o :-) Hence the purpose of this newsletter.
Tom your comment " Or, in short, people have to start somewhere " is exactly the point when assessing information consolidation without incremental calibration we assume all companies are the same within a given assessment. A small change to the criteria would enhance the oversight. This applies to any other assessment approach, as they say "the devil is in the detail"