Sunday, September 16, 2007

Equity Research

1. Saelm Schooner - Equity Research department

Our Equity Research department was started by Kenneth C. Nagy, CFA in 2004. Ken's strong background in equity models, industry analysis and identifying long and short sell candidates provides investors a unique insight in to what makes a solid portfolio.

The department builds unique portfolios according to investor's individual risk return characteristics. We combine fundamental analysis with what we call our endowment theory. Fundamental analysis is the evaluation of financial information such as income statements, balance sheets, and statements of cash flow. We also analyze the company's competitive position, its products, patents, and customer health. Our endowment theory is based on several large university endowments, which bucked the trend of losing money from 1999 to 2002. They did this by using private equity and alternative investments.

Stock in our universe must pass the following requirements:
Our Dividends Yield at least 2.0%.
We do not invest in Stocks with more than 50% Debt to Equity capitalization.
We find Stocks with Strong Free Cash Flow (Net income +Depreciation &0151; Capital Expenditures-debt).
We search for Stocks in Populations that matter (Baby Boomers in America, Young population in India, China).
Use Enterprise value as opposed to Price/Earnings.
Use our Equity Research Department to help you invest wisely in today's stock market.


2. Conflict of interest policy.
Mizuho International plc
Conflicts of interest management policy – investment research
1. Introduction

This document sets out Mizuho International plc’s (“Mizuho International’s”) policies to manage effectively the conflicts of interest that may arise in the preparation and distribution of investment research as required by the rules and guidance contained in chapter 7.16 of the Conduct of Business rules issued by the United Kingdom’s Financial Services Authority. The policy has been reviewed and approved by Mizuho International’s management and is subject to monitoring by the Company’s Compliance Department.

Mizuho International issues research on Japanese equities (equity research) and fixed income securities (credit research) which is intended to be objective and impartial. Investment research may take the form of reports on specific companies or industries, or economic research and strategy reports containing references to particular companies or issuers.

Equity research is prepared by Mizuho Securities Co, Ltd (“Mizuho Securities”) Equity Research Department based in Tokyo and is authorised for distribution by Mizuho International to its clients. This research is prepared in accordance with Mizuho Securities internal policies and procedures which comply with the requirements of the Japanese regulatory authorities and is subject to monitoring by the Compliance Department of Mizuho Securities.

Credit research is prepared by the Credit Research Department of Mizuho International in London. Credit research is prepared in accordance with internal procedures which supplement this policy.

Investment research is distributed to intermediate customers and market counterparties only. Mizuho International does not deal with or distribute research to private customers.

Different conflicts of interest can arise in relation to the preparation and distribution of equity research and credit research. As a result, the controls that have been implemented to ensure the integrity and impartiality of equity and credit research differ in certain areas.

2. Limitations
This document is prepared and published in order to comply with the United Kingdom’s Financial Services Authority rules and is not intended to create third party rights or duties or to form part of any contractual agreement between Mizuho International and any client.

Not all types of reports and recommendations issued by Mizuho International are intended to be impartial investment research covered by the policies and procedures described in this document.

This policy does not cover trader commentary, trade execution ideas and other written or electronic analyses prepared for a current or prospective investor or counterparty (or group of current or prospective investors or counterparties) by a salesperson, trading desk employee or other non-research department employee who is not engaged principally in the preparation or publication of communications that would otherwise be considered research reports.

Reports identified or marked as investment research or written by an investment research analyst or are otherwise held out as being impartial analyses of a security or securities or issuer or issuers are covered by this policy. Unless otherwise stated, the policies described apply to both research on Japanese equities prepared by Mizuho Securities and distributed by Mizuho International and credit research prepared by Mizuho International.

This policy may be reviewed and amended at any time.

3. Supervision and remuneration of analysts
Investment analysts are not supervised by, nor do they report to, investment banking, sales or trading personnel. Senior management to whom Investment Research Departments report may have general responsibility for overseeing certain investment banking, sales and trading functions.

Investment analysts have discretion as to the initiation and termination of research coverage of a company and are responsible for deciding on the content and timing of investment research.

Investment analysts’ remuneratio n is not based on specific investment banking transactions or recommendations contained in investment research but is linked to the general profits of Mizuho Securities (for equity research analysts) and Mizuho International (for credit research analysts), which may derive in part from investment banking business.

Research is only issued after sign off by the Head of Investment Research in Tokyo for equity research and London for credit research. In addition, equity research is also subject to review by the Compliance Department of Mizuho Securities.

4. Involvement of analysts in other activities
Investment analysts are prohibited from undertaking activities which may conflict with the requirement to issue impartial research.

Investment analysts may attend road shows but are not permitted to be actively involved in these nor may they take part in marketing pitches.

Investment analysts are permitted, with Compliance Department approval to write articles for investment magazines, make presentations at seminars and speak to the media.

Credit research analysts are permitted to provide information to trading staff on the relative value of certain securities compared to other securities. This information may only be provided to trading staff and may not be published for clients.

5. Avoiding inappropriate influences
Policies and procedures have been implemented to ensure that investment analysts do not offer or accept gifts or inducements which may give the perception that investment research is not impartial.

Policies and procedures have been implemented in relation to personal account dealing and outside business interests to ensure that conflicts of interest which may arise between investment analysts’ personal interests and the need to prepare impartial research are appropriately managed. Investment analysts must obtain approval from the Compliance Department prior to undertaking personal account trades and are subject to additional restrictions to trading in the issuers they cover.

Sections of draft research reports may be sent to relevant investment banking staff and issuers only for the purposes of verifying factual accuracy. Sections containing research summaries, recommendations and target prices are removed from the draft reports. Changes to research following review are subject to appropriate approval and records of such changes are maintained.

6. Means and timing of publication
The contents of research or recommendations are not made available to proprietary traders or other trading desks ahead of publication.

Reports may be published in written form, or sent to clients by email or fax and published on Mizuho International, Mizuho Securities and third party websites. Equity research on a company is not issued when Mizuho Securities or Mizuho International is the lead manager or co-lead manager to an issue from the time the mandate is obtained until the payment date or, if later, 40 days following the issue date for an IPO or 10 days following the issue date for a secondary offering.

It is common practice in fixed income markets for issuers to look at a financial institution’s distribution and research capabilities before making an appointment. As a result, Mizuho International Credit Research Department may issue pre-deal research on an issuer to which Mizuho International staff are marketing investment banking services prior to an issue. Additional procedures exist to ensure that there is no external influence on the content and coverage of pre-deal research including prohibitions on promises of favourable research and the avoidance of recommendations, price ranges or targets.

3. Recommendation Issued by FSA on Equity Research Dept. of UBS Japan
Press Release
May 21, 2004
Based on the inspection results of
UBS Securities Japan Ltd.

1. Recommendation Issued

The Securities and Exchange Surveillance Commission(''SESC'') today issued a recommendation that the Prime Minister and the Commissioner of the Financial Services Agency (''FSA'') take administrative disciplinary action pursuant to Paragraph 1 of Article 20 of the FSA Establishment Act based upon the results of the inspection of UBS Securities Japan Ltd. (Tokyo Branch located in Ohtemachi, Chiyoda-ku, Tokyo; Simon Bunce as Representative in Japan ; staffed with approximately 700 employees including directors; hereinafter referred to as '' UBS Securities''), which found the following facts constituting violations of laws and regulations by UBS Securities.

2. Facts Found
State of insufficient internal control for the prevention of unfair trade by making use of undisclosed corporate information
According to UBS securities, it has given instructions to its Compliance Department to provide in-house training programs on undisclosed corporate information to its employees and has set a policy of controlling the undisclosed corporate information strictly in accordance with its in-house rules in cases it has come to obtain such information, in order to prevent unfair trade. UBS securities also states, with regard to research analyst reports, that it controls information by means of establishing in the Equity Research Department an examination system that checks whether the undisclosed corporate information is contained or not in the reports.
However, under the circumstances where the Head of the Equity Research Department and the Head of the Compliance Department have not taken appropriate measures to control the undisclosed corporate information, a researcher at the Equity Research Department, who obtained such information from a listed company with respect to the purchase of its own shares and the downward revision of the company's settlement of accounts, put the information in his research analyst report without being aware of the fact that the information concerned falls under the undisclosed corporate information. Moreover, the Publications Section in the Equity Research Department, being in charge of examining the report, failed to detect the descriptions in question. As the result, from April 2003 onward, UBS securities posted the research analyst report with the undisclosed corporate information on its website. The researcher explained the summary of the report at the in-house meetings and the Equity Research Department emailed the report to a large number of its customers. UBS securities has thus been conducting its business in such state recognized as having an insufficient internal control of undisclosed corporate information from the viewpoint of preventing unfair trade.

The aforementioned act of UBS securities is acknowledged to fall under the act of conducting business under ''the state that a securities company is not deemed to have a sufficient degree of internal control for the prevention of unfair trade by making use of information pertaining to corporations, in the light of its control of information pertaining to corporations which it obtained'' provided for in Item (4), Article 10 of the Ordinance of Cabinet Office Concerning Regulation, etc. of Conducts of Securities Company as applied by Paragraph 25, Article 24 of Ordinance of Cabinet Office Foreign Securities Firms based on Item (2), Article 43 of Securities Exchange Law as applied by Paragraph 1, Article 14 of the Law on Foreign Securities Firms.

Download from ubs guidelines on complaince by equity research dept.

4. Rabo Bank Equity Research

Up-to-date knowledge is essential in the financial world, where small mistakes can have large consequences. We offer research on companies, sectors and themes. In fact, to offer the best research on the Benelux companies we specialise in local fieldwork and in-depth and close relationships.

We cover small, medium and large cap companies. We know the Benelux markets, as well as the broader reach of companies trading from this base in Europe to markets across the globe. Our idea-driven, independent research and analysis is what investors count on to improve their performance.

Our team of 17 experts has a virtually comprehensive knowledge of companies - we cover almost 95% of the Benelux market - and an extensive understanding of most other sectors. The size of the Equity Research department allows us to handle the market information that we obtain pro-actively and intensively. Our analysts spend up to 50% of their time traveling to clients worldwide and on the phone, in direct contact with investors to share with them that extra insight that will make the difference.

Equity Research from Rabo Securities is highly acclaimed by our customers. They put their trust in the knowledge that we understand the look and feel of the market, locally and internationally. If you want to know about today, read the news. If you want to know about tomorrow, read the research.

The majority of the world's 25 largest institutional investors is amongst our client base. We deliver research covering all major business sectors. As one of the Netherlands' leading financial institutions we offer strong Benelux-focused research products, incorporating a broader European perspective.

The prestigious Institutional Investor Survey 2007 has ranked Rabo Securities Equity Research as the third best Benelux team specialised in Equity Research. Last year we where ranked second and this was up from a third position in 2005.

Rabo Securities
Rembrandt Tower
Postbus 94640
1090 GP Amsterdam
T. +31 (0)20 460 4747


S&P Stock Research Ranked Best-Performing of Large Research Firms by

S&P Recommendations Over Past 12 Months Outperformed Those From Other Firms Analyzing 500+ Stocks
New York, N.Y., November 14, 2002 — Over the past 12 months, the returns of a model portfolio based on the stock recommendations of Standard & Poor's team of 60 U.S. equity analysts outperformed those of the other large equity research firms tracked by, Standard & Poor's announced today. Standard & Poor's recommendations were measured against those of other research firms who analyze more than 500 stocks.

The hypothetical portfolio1, containing stocks ranked one-STAR ("Sell") through five-STARS ("Buy") under the STARS ranking system from Standard & Poor's, a global leader in independent financial research and analysis, was tracked by using its proprietary performance measurement system and showed returns of 13.16% over the trailing 12-month period ending November 12, 2002.

"It's a testament to Standard & Poor's thorough independent equity research that a portfolio of their analysts' recommendations has shown the best performance among firms who analyze more than 500 stocks," said Kei Kianpoor, CEO, "Standard & Poor's participation in the measurement process underscores its commitment to transparency and performance measurement of its stock recommendations at a time when leadership in that role is sorely needed," continues Kianpoor.

"We believe's best-performance recognition affirms that our business model as a provider of independent research serves investors well," said Kenneth Shea, Managing Director of Global Equity Research, Standard & Poor's. "Independence alone is not enough, however," Shea continues. "Breadth of company coverage, depth of analysis, and of course, performance, are also important. Today's investors want to be able to track independent research recommendations over time and through market cycles, and they appreciate the transparency Standard & Poor's provides them through Standard & Poor's STARS recommendations," Shea adds.

Standard & Poor's Stock Appreciation Ranking System (STARS), which was first introduced on December 31, 1986, reflects the opinions of Standard & Poor's equity analysts on the price appreciation potential of more than 1,200 U.S. stocks for the next 6-12 month period. Rankings range from 5-STARS (strong buy) to 1-STAR (sell).

Standard & Poor's 5-STARS ("buy") Stock Selections2 increased in value by 916% from STARS' inception on December 31, 1986 through October 31, 2002, compared with growth of 265% for the S&P 500 during the same period, excluding dividends. In addition, stocks ranked as 4- and 5-STARS have, as a group, outperformed the S&P 500 index during the past 1, 3, 5, 10, and 15 year periods. On an annual basis, STARS have outperformed the S&P 500 index eleven times, under-performed three times, and tied once. Stocks ranked as 1-STAR and 2-STAR have, as a group, significantly under-performed the S&P 500 over the past 5, 10 and 15 years. offers financial research tools based on its proprietary performance measurement system. is widely considered by the media and investors worldwide to be the leading source of data for the identification of exceptional and objective equity research.

Standard & Poor's analytic services are performed as entirely separate activities in order to preserve the independence of each analytic process. All non-public information received during any analytic process, including credit ratings, is held in confidence. Standard & Poor's analysts do not disclose non-public information outside of their specific analytic areas.

Standard & Poor's, a division of The McGraw-Hill Companies, Inc. (NYSE: MHP), has the largest U.S. equity coverage count among equity research firms that are not affiliated with a Wall Street investment bank, analyzing 1,220 U.S. stocks. Standard & Poor's is a leader in providing widely recognized financial data, analytical research and investment and credit opinions to the global capital markets. With more than 5,000 employees located in 18 countries, Standard & Poor's is an integral part of the world's financial architecture. Additional information is available at

1 has created a performance measurement tool called ROSS (Rate of Success System). The system quantifies the recommendations of Equity Research Firms by hypothetically purchasing shares in the recommended stock at the time of the recommendation. In short, the system calculates returns as if the Firm had actually purchased or sold shares at the time of the recommendation. Furthermore, the amount of shares purchased depends on the strength of the recommendation. For example, if a Firm's initial recommendation for the period is a buy on Cisco Systems (CSCO) then the system purchases 300,000 shares in CSCO at the price at the time of the recommendation. The price used is the opening price on the day of the recommendation. If the Equity Research Firm upgrades Cisco at a later date from a "buy" to a "strong buy" then the system increases the number of shares by 50% at the time of the upgrade. Similarly, if an Equity Research Firm downgrades a stock then the system decreases the number of shares by 33.3%. If a Firm reiterates a recommendation then the position in that stock is left unchanged. If a Firm issues a bearish rating on the stock (underperform, sell or strong sell) the system goes short the stock in the hypothetical portfolio. A short position is calculated as the inverse of a long position to reflect an analyst's market timing.

2 It should not be assumed that recommendations made in the future will be profitable or will equal past performance. The above performance calculations for STARS do not take into account reinvestment of dividends, capital gains taxes or brokers' commissions and fees. A complete list of STARS recommendations made in the last year is available from Standard & Poor's upon request. STARS are published by Standard & Poor's Equity Research department, which operates independently from, and has no access to information obtained by, Standard & Poor's Ratings Services, which may in the course of its operations obtain access to confidential information.

John Piecuch
Communications Manager
Standard & Poor's
(212) 438-1102

Richard Furlin
Senior Director, Equity Products
Standard & Poor's
(212) 438-6351

Researcn analyst policies Scotia Capital

Researcn analyst policies UBS

Fox Pitt and Kelton Ltd, June 2006


10 Uncommon Values®

A Tradition of Outperformance
The 10 Uncommon Values® Portfolio was selected by Lehman Brothers' 10 Uncommon Values® Selection Committee. Every year, each senior equity research analyst presents his or her best fundamental investment idea to the Firm's 10 Uncommon Values Selection Committee. This year's 10 Uncommon Values Selection Committee is comprised of seven investment professionals of the Firm. Each stock of the 10 Uncommon Values Portfolio has been chosen because of its value relative to the opportunity the 10 Uncommon Values Selection Committee sees for the company 12 months from today. This process has been a fixture at Lehman Brothers for 57 years.

The Firm's Equity Research Department, dedicated to providing insightful analysis of global stock markets and companies, is recognized for the quality and timeliness of its investment recommendations. Covering more than 100 sectors and 1,500 companies, the Group has expanded to approximately 600 professionals globally — substantially increasing its size and capabilities in recent years.

After the intensive screening process in which Lehman Brothers analysts present their ideas to the 10 Uncommon Values Selection Committee for analysis, the list of stocks is reviewed again to determine which companies offer the best investment ideas for the coming year. Finally, the 10 Uncommon Values Selection Committee selects what it believes to be the best 10 ideas — that year's 10 Uncommon Values.

As always, the 10 Uncommon Values represent stocks which Lehman Brothers believes will outperform the Standard & Poor's 500 Stock Index. Although past performance does not guarantee future performance, Lehman Brothers believes that its methodology has been a significant contributor to the success of the 10 Uncommon Values.

Our 57-Year Tradition
(21 Apr 1949 through 19 Jun 2006)
Of the 570 stocks recommended since 1949, 371 advanced, 195 declined and 4 remained unchanged in their year of recommendation. In its 57-year history, the 10 Uncommon Values Portfolio has significantly outperformed the S&P 500 Index.

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