Business-valuation

Shareholders today are becoming used to scanning the headlines for the most recent corporate disaster. Where were the boards that were theoretically looking after the shareholders' interests? While there has been much public moaning about the problems, most of the "solutions" being proposed are band-aid therapy, neglecting the root problems: lack of clarity about the role of governance, and lack of a systematic approach to ensure accountable governance while at the same time appropriately empowering management.

The Policy Governance model described in this book provides a solution. Boards that conscientiously apply the principles set out in the model can be confident that they are indeed fulfilling their fiduciary responsibility to their shareholders. This book provides the clearest, most straightforward and lucid explanation of the principles necessary to responsible governance that I have seen in my years of experience as a governance coach and consultant. I highly recommend it, not only to corporate boards, but to governing boards of any organization.

One common thread has connected the companies involved in the recent spate of high-profile corporate bankruptcies and scandals: The failure of boards of directors to control management. John Carver, an international consultant on corporate governance, explains the role of the board of directors and defines the proper relationship between the board and top management. To summarize: The board commands; management obeys. Since this is all too often not the case, we from getAbstract strongly recommend that everyone in business read this book for its essential advice on strengthening the authority and accountability of corporate boards of directors.

To even to most junior quant, this book would be content free. What's more, he promises the revolutionary new Calamos valuation method (now, not even Nobel prize winners name their theories after themselves, they let other people do it for them, so already, suspicion) but again, nothing, just some snapshots from the screen of his software. The book blurb is misleading, it actually promises the method, not just an advert for it. Do not buy this book, you will learn nothing.

The table of contents and size of this book suggests a real winner, perhaps even a Graham & Dodd treatment of the convertibles arena. The wonder is how such a long-winded tome can leave the convertibles student so wanting. The book's problem is probably the author's conflicted intentions: "Do I want my readers to go out and find some nice convertible bonds, or do I want them to pay me to go find them some nice convertible bonds?" Guess who gets short shrift?

The introduction to convertibles section is reasonably well written. But the analysis and strategy sections of the book are suspiciously hazy. I say " suspiciously " because the book's author delivers just enough information so one might be comfortable handing over portfolio management to the author's investment management firm, but not nearly enough to implement a portfolio for oneself. Even Calamos' simple price model is insufficiently described.

Thus, after a windy, winding road of nearly 400 pages, CONVERTIBLE SECURITIES reads as a mediocre introduction to convertibles imbedded within an advertisement for the Calamos firm (for which I had to pay $65!).

Upon reading this book I realized what I was missing from my portfolio. Investing in convertible over the past 3 years has enabled me to keep my head above water since the market peaked back in 2000. My portfolio was only down 4% in 2001 and 5% in 2002 because of the addition of converts.