Shareholder Optimization: Balancing the Shift in Passive and Active Funds
By Steven Rubis
Panelists:
Ryan Kiras, Lead Investor Relations Analyst, Coeur Mining, Inc.
Brian Leite, Vice President Client Services, ModernIR
KEY TAKEAWAYS
- Share ownership represents the lifeblood of a publicly traded company, so investor relations officers (IROs) spend significant time studying the composition of a company’s shareholders – and attempting to optimize the makeup of that shareholder base. IROs want to make sure they are talking to the right investors, optimizing management’s time in investor engagement, and building a stable long-term investor base. Fortunately, three strategies can help companies optimize their shareholder bases, reduce volatility and improve stock valuations, said Brian Leite.
- Own the Calendar: Understanding key trading dates, such as options expiration and economic data announcements, can impact stock price and volatility – and therefore, should be considered before setting the calendar for your company’s earnings and other key announcements.
- Minimize AI Machine-Driven Volatility: Artificial intelligence-driven trading bots react to online news in seconds. An enterprising IRO will seek to slow down these trading reactions. For example, consider publishing a one-page advisory with key numbers instead of a press release, because the latter is easily searchable by the bots. The full disclosure goes in the Form 10-Q. Visa is among the companies that have taken this approach.
- Maximize Passive / Quant Participation: Passive and quant investors are a dynamic force in equity trading today. By definition, passive and quant investors operate with limited human interaction. Adding investor-focused descriptive language to the “about” section of a press release or advisory can make it immensely easier for these investors to find you via their screening process. One example: Company X is a mid-cap industrial manufacturer in the Russell 2000 Index. Make sure you measure the outcomes of this strategy over time versus the company’s baseline results expectations.