“Executives can talk all they want, but the best vote of confidence is putting one’s own money on the line just like outside investors.”
Skin In The Game is a term coined by renowned investor Warren Buffett referring to a situation in which high-ranking executives and insiders uses their own money to buy stock in the company they are running.
“Investors like to watch what the directors and executives in leadership positions of stock market-listed companies are doing with their own money. The theory is that – regardless of any dealing restrictions – these people are in the best position to judge how well, or otherwise, their business is faring. So presumably their personal trading must be a handy guide to where the shares are heading next.”
The Annual Businessuite Skin Index seeks to measure and gauge the extent to which Businessuite Top 50 CEO’s who run Businessuite Top 50 & 100 Companies use their own money to buy stock in the company they are running and if they are managed by like-minded individuals who share a stake in the company.
“We like to see the people who run businesses showing confidence in them by committing their own capital. And directors are well aware their trading is closely watched by investors, so they often buy stock when they’re allowed to.”
The 2017 Index is based on the following:
- Main Stock Exchange Last trading price for 2016
- Central Bank US$ selling price as at 30/12/2016
- Jamaica shareholdings based on September 2016 quarterly financials
- Trinidad and Barbados shareholdings based on Annual Report 2015
- Where noted connected party holdings are included
Trinidad and Tobago