How a CEO’s personality affects stock prices

Har­vard Busi­ness Review con­duct­ed a study, inves­ti­gat­ing how the mar­ket reacts to CEOs’ per­son­al­i­ties. They hypoth­e­sized that CEOs’ observ­able ten­den­cies could sig­nif­i­cant­ly influ­ence investors’ per­cep­tion of the firm and there­fore its val­ue. The ‘Big Five’ per­son­al­i­ty traits were the focus of the study: con­sci­en­tious­ness, neu­roti­cism, extro­ver­sion, open­ness to expe­ri­ence and agree­able­ness. The study found that there is a cor­re­la­tion between a CEO’s per­son­al­i­ty and a firm’s stock volatil­i­ty. The arti­cle expands on the exact find­ings of the study, but they has 2 over­all thoughts: first, there is wis­dom for man­ag­ing impres­sions for CEOs. Sec­ond, boards should be aware of per­son­al­i­ty as a fac­tor when select­ing a CEO as it may influ­ence an executive’s poten­tial effec­tive­ness as the face of the company.

The importance of gratitude: CEO writes 9,200 birthday cards a year

Shel­don Yellen, CEO of prop­er­ty-restora­tion com­pa­ny BELFOR Hold­ings, Inc., hand-writes birth­day cards to every employ­ee as a way of say­ing thank you. Yellen tells Busi­ness Insid­er, “there is an inside joke with acqui­si­tions that I ask pri­or to clos­ing: ‘How many more peo­ple?’” The effect that this has had on the com­pa­ny has been incred­i­ble as Yellen believes that by tak­ing the time to per­son­al­ly thank his employ­ees every day, he has cre­at­ed a cul­ture of com­pas­sion through the whole com­pa­ny. Despite crit­i­cism from oth­er CEOs that this is a waste of time, career experts say that the best man­agers are ones that are strong in pos­i­tive rein­force­ment and work­ers also admire traits in their boss­es when they pay atten­tion to career accom­plish­ments. Yellen must be doing some­thing right!

US tech giants turn to India for new apps before world release

After two decades cov­er­ing the Inter­net sec­tor, RBC Cap­i­tal Mar­kets’ Mark Mahaney says that India is emerg­ing as the test­ing and acqui­si­tion play­ground for glob­al con­sumer tech­nol­o­gy com­pa­nies, becom­ing more pop­u­lar than Chi­na because it has the same growth dynam­ics but with few­er reg­u­la­tions. For exam­ple, Net­flix rolled out a mobile plan in India at a much cheap­er rate than what it charges for a basic plan in oth­er coun­tries. It has now cre­at­ed orig­i­nal con­tent to cap­ture more mar­ket share. There is huge room for growth for US tech giants in India, as Mahaney explains, quot­ed by The Eco­nom­ic Times, “India is less than 5% of Amazon’s total rev­enues but it has the poten­tial to get to that lev­el with­in five years.”

SoftBank in talks to take control of WeWork amid cash crunch

Bloomberg report­ed that WeWork, which pro­vides shared work­spaces for star­tups, free­lancers etc., is con­sid­er­ing a bailout that will hand con­trol of the once high-fly­ing start­up to Soft­Bank Group Corp. Soft­Bank, which is already WeWork’s largest stake­hold­er, is con­vinced that it can turn its finan­cial issues around with the right finan­cial con­trol. How­ev­er, WeWork has anoth­er back­up plan: they are con­sid­er­ing a $5million bailout from JP Mor­gan Chase & Co. If the board does opt for the Soft­Bank deal, the Japan­ese com­pa­ny will be tak­ing on a trou­bled enter­prise at a time that it’s strug­gling to con­vince the mar­ket about its longer-term invest­ment vision.

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Your Glasford Inter­na­tion­al Deutsch­land Research and Ana­lyt­ics Team