I’m a Pediatric Cardiac Anesthesiologist by trade with a keen interest in in-depth analyses of phenomena and processes which lead to clever solutions to technical and business challenges. I received a B.S. degree summa cum laude in Molecular Biophysics and Biochemistry from Yale College and an M.D. degree from Yale University School of Medicine; in addition, I hold M.S. degrees in Electrical Engineering, Mechanical Engineering, and Aeronautics and Astronautics from Stanford University School of Engineering.
Spent my entire 28 year career on Wall Street with over a decade at Bear Stearns. No "Wall Street Titan" in real life but WST is an alias that I've used for years on Yahoo so I use it when I write on SA. I have gained a significant amount of knowledge regarding the stem cell sector over the years and have recently launched a premium service covering this exciting area.
I am an Senior Biotech Analyst with Zacks Investment Research, Inc. I joined Zacks in February 2014.
Prior to joining Zacks, I was an NRSA Postdoctoral Fellow working in a cancer genetics laboratory.
I received my PhD in Biochemistry and Biophysics from the University of North Carolina at Chapel Hill. I also have my BS and MS in Biochemistry from Virginia Tech.
Individual Investor with a preference for long-term value-oriented investments that are based on in-depth research & understanding of the company's products and markets. Educational background includes mechanical engineering and MBA (Finance) degrees.
Anita Dushyanth is a Biotechnology Technology and Medical Devices Analyst with Zacks Investment Research.
She has worked as a researcher in the field of Bioengineering at the University of California, Los Angeles (UCLA) for over 10 years. Her expertise includes research that delves into the biomechanics of the human body, degenerative disease progression, quantitative image analysis and optimization, and design and development of medical compliant devices. She has published and presented several research articles and has also been a peer reviewer and an editor for a number of prestigious journals in the field of biomedical engineering. Prior to that, Anita worked as a researcher at the Department of Radiology and Biomedical Imaging at the University of California, San Francisco (UCSF).
Anita holds a PhD degree in Bioengineering from UCLA, M.S. in Biomedical Engineering from Wright State University, Dayton, OH and B.S. in Instrumentation Engineering from the University of Madras, India.
I am a private investor based out of Toronto, Canada and I have been investing since 2003. After 8 years in Corporate Finance with a Canadian Telecom company I have decided to dedicate myself full-time to the capital markets. I write on Seeking Alpha to demonstrate my financial analysis and writing skills across a variety of industries and to take advantage of any story-based trading opportunity that may arise. My passion and greatest depth of knowledge is on Canadian small cap stocks and I consider my blog posts to be some of my best work. I am interested in any freelance opportunities that may arise outside of Seeking Alpha on Canadian or American listed stocks.
Andy Hecht is the chief market strategist for Carden Capital and Carden Futures. Andy is a sought-after commodity and futures trader, an options expert and analyst. He spent nearly 35 years on Wall Street, including two decades on the trading desk of Phillip Brothers, which became Salomon Brothers and ultimately part of Citigroup.
Over the past two decades, he has researched, structured and executed some of the largest trades ever made, involving huge quantities of precious metals and bulk commodities.
Andy understands the market in a way many traders can’t imagine. He’s booked vessels, armored cars and trains to transport and store a wide range of commodities. And he’s worked directly with The United Nations and the legendary trading group Phibro.
Today, Andy remains in close contact with sources around the world and his network of traders.
“I have a vast Rolodex of information in my head… so many bull and bear markets. When something happens, I don’t have to think. I just react. History does tend to repeat itself over and over.”
His friends and mentors include highly regarded energy and precious metals traders, supply line specialists and international shipping companies that give him vast insight into the market.
Andy’s writing and analysis can be found on a number of market based websites including CQG. Andy lectures at colleges and Universities. He also contributes to Traders Magazine. He consults for companies involved in producing and consuming commodities. Andy's biweekly radio show, The Commodities Hour with Andy Hecht, can be heard on Tuesdays and Thursdays from 5-6 PM EST on www.tfnn.com. Andy’s first book How to Make Money with Commodities, published by McGraw Hill was released in 2013 and has received excellent reviews. He is currently working on his second book, Luster. Andy held a Series 3 and Series 30 license from the National Futures Association and is associated as a collaborator and strategist with hedge funds. Andy is the commodity-expert for the website about.com and blogs on his own site technomentals.com.
Individual investors should feel free to message me privately about my real-time subscription service, which is very affordable. That is also included with my short idea product for institutional investors, here on Seeking Alpha.
For a better mobile experience on Seeking Alpha click the top right menu icon on most browsers and select "request desktop site".
I am a former financial communications programmer, turned full-time investor. I began investing in the mid-1990s, looking for a way to achieve early retirement. (A goal in which I have succeeded, if you don't consider full-time investing a job.) I took a scientific, experiment-based approach rather than a studious one. I feel that this approach, combined with my extensive programming work in financial markets and directly with traders has given me uncommon contrarian insight into what really drives market dynamics.
To that end, my articles will center around stocks and their derivatives because that's where I have the most experience (over 20 years). I may occasionally comment on currencies, where I believe I have a sound academic knowledge, but less trading experience.I will always refer to a company by name or some abbreviation thereof. By contrast, I will refer to the stock a company issues by its ticker symbol. I think it can be important to differentiate between the two.
Qualified investment professional with over 6 years experience in Wealth Management and Investment Advisory.
Proficiency in fundamental equity research, corporate valuation, mutual funds research,m asset allocation and portfolio construction.
Adept in developing investment strategies using applied macro economics and valuations.
Specialisation: Wealth Management, Equity Research, Valuation, Asset Allocation and Portfolio Construction
I have a Bachelors Degree In Business Administration. I have been investing in biotech stocks for many years, and I prefer to invest as a long term investor. With that In mind I seek stocks that have long term value! I primarily Like to Invest In biotechnology stocks and I accept the risks.
I Write for the Healthcare Sector and Stock market in general. I contribute to Seeking Alpha, Talk Markets, and CNA Finance. I run my own biotechnology website Biotechpicklist.com and in addition I post stock market news on my other website Wallstreetrain.com
PhD Scientists don't often stick their heads out to look at the rest of the world. But I make a point to follow the financial markets; specifically public and private biotech and healthcare companies. I've been personally investing in these companies for over a decade.
I am an analyst and Level II Candidate in the CFA Program that has gained experience in the investment industry through positions as a proprietary trader and a portfolio management administrator. I began contributing to Seeking Alpha as a way to share my thoughts on the biopharmaceutical industry. I discussed ways to minimize risk in biopharmaceutical investing through conservative pipeline valuation and balance sheet analysis to identify companies presenting a compelling valuation to potential investors. I also touched on ways to apply knowledge of the markets to improve personal finance. My pieces included either stock-specific analysis or general biopharmaceutical investing discussion through my Biotech Weekly blog. My research appeared on the websites of CNBC, Seeking Alpha, Reuters, Google Finance, Morningstar, NASDAQ, and MarketWatch.
Note: Articles and comments are my own opinions, are not related to the opinions of my employer, and should not be considered investment advice. Make sure to do your own due diligence before making an investment decision. Thanks!
I am an Independent biotechnology stock Researcher and investor based out of Dallas, Tx. My primary focus is on the small-cap biotech segment of the market.
I specialize in long/short ideas as well as short-term trade strategy.
Strategic investor/researcher with a primary focus in high percentage gain poised long equity investments. My research areas include the biotech/pharmaceutical sector, precious metals markets, short equities and natural resources.
I am an active investor who takes part in every type of trading and do scrupulous research on any investment I make. I use technichals as a rational indicator in an irrational market. Research and investing is what I do when I am not sleeping and when I should be sleeping and hope you find the extensive research helpful in making decisions on what to trade. I manage all my accounts while running my business. All my articles and tips are my opinions and i encourage you to do your own due diligence before investing.
Assumes multiple responsibilities in a leading global fintech firm, with current role developing quantitative models and investment strategies with a wide spectrum of financial data, in particular the proprietary index business by collaborating with index providers and fund sponsors to build smart-beta indices and prototypes. Holds a Master on Molecular Biology and Biochemistry from Fudan University Medical School, MBA from Case Western Reserve University Business School and is a Chartered Financial Analyst (CFA) member of New York Chapter (NYSSA).
I have spent over thirty years in the financial services industry and I am the author of Dead Companies Walking: How a Hedge Fund Manager Finds Opportunity in Unexpected Places, an Amazon Best Book of the Month. Since 1991, I have managed the hedge fund Crown Capital in Marin County, California.
I am an independent equity research analyst and consultant. I focus on finding small-cap biotech stocks where I believe there is favorable risk / reward because of misinformation, lack of information, or a potential fundamental turnaround. I provide detail analysis for investors and investor relations companies. I also provide due diligence and advisory services to companies. Some names I write on I invest in personally and will disclose my position. Names that have hired me to provide due diligence or advisory services I will disclose a business relationship. I previously worked for Zacks Investment Research from 2003 to 2015 as a Senior Biotechnology Analyst. Prior to Zacks, I spent 1999 to 2002 managing money with Eastover Capital in Charlotte, NC where I focused on large-cap equities, specializing in healthcare, energy, and technology. Prior to joining Eastover, I worked as a research scientist for TechLab, Inc., a biotechnology company focused on developing diagnostic kits and vaccines for infectious diseases, between 1995 and 1998. I also spent a year working at the Fralin Biotechnology Center, and a year working for a cancer researcher while at Virginia Tech. I have a B.S. in Biochemistry from Virginia Tech, with a B.A in Chemistry and a minor in Math. I have a M.B.A. in Finance, with a concentration in Securities Analysis, from Wake Forest University. I hold the Chartered Financial Analyst (CFA) designation.
Private Investor with 10 years of biotech trading experience.
I use basic disciplined research approach to discover new investment ideas. Biotech sector is full of violent stock moves and trial failures. On one hand it requires traders to be quick on their feet and on the other hand it forces investors to have a great deal of patience.
I enjoy the challenge of mining for hidden gems, because its 10 times as hard to do that than predicting failures. Failure is the norm in biotech, I look for exception to the norm!
Dr. Schwartz is a 30-year veteran of the Pharmaceutical Industry most recently in the role of Executive Director, Strategic Transactions for Bristol-Myers Squibb Company where he has more than a dozen completed transactions to his credit. He speaks frequently on the Biotech-Big Pharma dynamics and evolving research and treatment paradigms in oncology and is perhaps best known for predicting FDA’s rejection of Dendreon’s Provenge vaccine in 2007 (San Francisco Chronicle, March 30, 2007). Provenge ultimately won FDA approval in April, 2010.
Dr. Schwartz founded RHS Advisors, LLC, a life-sciences consulting firm, in July 2010.
Hilltop Warrior has been an investor/speculator for three decades. He writes about and trades options on the broad market, gold and silver, commodities and fixed income products and once in a while will take a stab at purchasing the odd small cap.
He spent several years as a broker at a major Canadian Brokerage before coming to his senses and realizing he ain't no salesman.
Bay Area Biotech is a group of self-organized life science graduate/medical/business students and postdoctoral scholars who are interested in utilizing our scientific training to evaluate biotechnologies and identify investment opportunities. Opinions published here are those of the authors.
Theodore J. Cohen, Ph.D., a research scientist, has been an investor for more than 50 years. Since 1980, he has focused his attention on investment research and investigative analyses of companies developing therapeutic drugs in the biotech sector. Dr. Cohen is a frequent contributor of Guest Opinions (op-ed pieces) to the Bucks County (PA) Courier Times (circulation: 80,000), where, since 2007, he has addressed such varied subjects as the conflicts of interest (COIs) associated with two members of the Provenge advisory committee (AC); the U.S. Senate’s Durbin Amendment, to tighten COI reviews of FDA AC members; and naked short selling. Cohen is the author of the award-winning novels Death by Wall Street: Rampage of the Bulls (AuthorHouse, 2010) and House of Cards: Dead Men Tell No Tales (Outskirts Press, 2011), which were inspired by real events. The books are available from Amazon.com, B&N, and 26,000 online bookstores worldwide. For details, see http://www.theodore-cohen-novels.com.
I am currently employed as a biologist and most of my work is in applied sciences. I have been trading on and off for the past few years mostly looking at companies in the Bio Science field, pharmacology, and some IT.
Follow @SmithOnStocks on Twitter for more updates (http://twitter.com/#SmithOnStocks
Please read this section carefully for some important disclosures.
Who Am I?
My name is Larry Smith. My career was spent on Wall Street as a biotechnology and pharmaceuticals analyst and also as Director of Research at Smith Barney and Hambrecht and Quist. On my website, SmithOnStocks, which can be addressed from this Seeking Alpha site, I publish articles on biotechnology and pharmaceutical companies. I attempt to be objective and present a balanced view of negatives and positives. Readers should not rely on Seeking Alpha for my latest views and articles on Seeking Alpha should be viewed as informational only. The reports section of my website reflects my most current view on a stock.
How Do I Get Paid?
My only source of revenues from my articles is from subscription revenues from my website. I do not receive any compensation from companies or investor relations firms to write articles. I do not receive any direct or indirect compensation from hedge funds, other investment managers or any entity to write articles. I consider direct compensation to be cash compensation that is directly or indirectly tied to my writing articles.
I also do not receive compensation in the form of content. I believe that it is not uncommon for some writers to receive content from hedge funds, other investment managers or any entity that are critical components of the articles that they write. I consider this as non-cash compensation. I do not receive advertising revenues from my website so there is no incentive to be sensational in order to create page hits. I only get paid if my subscribers believe that my articles are of value to them and they then decide to subscribe to my services.
You Should View Articles Published on Seeking Alpha as Informational Only
I want to make clear to readers that not all of the reports that I publish on my website are also published on Seeking Alpha. Also, I will sometimes make reports available on my website a significant period of time before publishing the same or a condensed version on Seeking Alpha. All of the articles that are published on Seeking Alpha and my website at the same time have consistent views and opinions. However, at a later data, it may be the case that my viewpoint and opinion may change and these changes in viewpoint and opinion may only be published in articles on my website.
For this reason, readers may want to check the reports section on my website for my current opinion on a stock and should not rely on the latest Seeking Alpha article as my viewpoint or opinion may have changed. The content on my website is intended only for subscribers, but non-subscribers can view the headlines in the reports section which in most cases but not all will announce a change in viewpoint or opinion. However, I emphasize that I undertake no obligation to update my articles on Seeking Alpha and the latest article on Seeking Alpha may not reflect my latest thinking. This is why I want to re-emphasize that any article published on Seeking Alpha should be viewed as information only.
What SmithOn Stocks is All About
SmithOnStocks is not registered as a securities broker-dealer or as an investment adviser with the U.S. Securities and Exchange Commission or with any state securities regulatory authority. SOS relies solely on publicly disclosed and available information. While SOS makes all reasonable efforts to confirm the accuracy of its statements and opinions, all comments should be considered only as opinion and should not be considered to be absolute fact. Investors should carefully read the Terms & Conditions and Disclosures sections of my website. Investors should carefully perform their own due diligence, seek other points of view and consult with their broker or financial advisor.
Investing in equities includes considerable risk, and investors should be prepared for the possibility of capital loss. This is particularly the case with biotechnology stocks in which hard to predict clinical and commercial outcomes can often disappoint investors and lead to unusually large declines in price. Potential investors in biotechnology stocks must often be prepared to risk the loss of substantially all of their investment. These stocks are only suitable for investors willing and able to accept unusually high financial risk. Users of my information acknowledge that SOS and its owner are not liable to any person or entity for the accuracy, thoroughness, reliability, or timeliness of the information provided. Users further acknowledge that SOS is also not responsible for any direct or indirect losses that may arise from the use of information provided to any person or entity.
Employees of SmithOnStocks or SOS do buy and sell healthcare stocks, some of which may be the subject of written articles appearing on Seeking Alpha. In the event that employees have a stock investment in a company, that ownership is fully disclosed in notes on Seeking Alpha. On any new recommendation, I have a 48 hour waiting period before initiating a position in a stock. I trade in line with my recommendations.
In 1999 I made an ethical breach that resulted in a suspension from being a registered representative in the securities industry for a period of time. I believe that this measure was harsh beyond any reasonable measure and totally unwarranted. I have gone to great lengths in this report to give my side of the story and I hope that you will read the in-depth account that I have provided. This took place over 16 years ago and has long since ended. There has been no restriction from the NYSE for many years on my working as a registered representative if I choose to go through the required registration procedures.
Still, this NYSE action is like a Scarlett letter that I carry. I would urge you to read the full account of the events that led to this NYSE action and if you do so I believe you will agree that this in no way reflects on my integrity and the way I have always conducted myself, then and now. I strongly believe that the action taken was excessive and I think that if you read my full account you will agree.
People make mistakes. Bill Clinton lied under oath, was impeached and disbarred as a lawyer in Arkansas in connection with the Monica Lewinsky affair. However, society has judged him on the body of work that he has done. Suspensions in the security industry can result from serious infractions in which investors are defrauded or swindled. In the events that led to my suspension no investors lost money and as I explain in this report investors who followed my advice made significant amounts of money. Before you rush to any conclusions, let me tell you my story.
I Am Proud in How I Have Conducted My Career
Before I go into the details of this ethical breach, I want to emphasize that I have had a distinguished career on Wall Street. My record from 1971 when I started on Wall Street until 1999 was unblemished. I came to New York from Indiana with no business connections and no money but through hard work I became a highly regarded Wall Street analyst and was selected to the Institutional Investor All Star team in pharmaceuticals for ten years in a row. Based on my record as being the top or one of the top analysts at Smith Barney, I was selected to be head of research from 1981 until 1989. I also served on the Board of Directors at Smith Barney.
Based on my strong reputation, Hambrecht and Quist approached me in 1989 to head their life sciences research effort and to run the annual H&Q (now JP Morgan) healthcare conference. I was a Managing Director and on the operating committee at H&Q. I left H&Q in the late 1990s because I disliked the bureaucracy that was such an integral part of being head of research. I had made enough money to be financially secure and I wanted to get back into doing what I loved, biotechnology research. I joined Tucker Anthony in 1997 as a biotechnology analyst.
Explaining the Events That Led to the NYSE Issue
Tucker Anthony had a sister firm called Sutro and a decision was made early in 1998 to move health care research from Tucker to Sutro. Tucker was an east coast based firm and Sutro was based in Los Angeles. Sutro leased a New York office to which I moved. It was here that an unfortunate train of events was set in motion that led to the NYSE action that put a stain on what I consider an outstanding career.
When I moved from Tucker to Sutro, I maintained my brokerage accounts at Tucker. I conducted normal trading in this account for some months. Then the research administrative research manager for Sutro contacted me and said that for regulatory purposes I would have to move my account from Tucker to Sutro. After some time spent in looking for a broker to handle my account at Sutro I became frustrated. At that time, I had over $5 million in my brokerage accounts. While I was sophisticated in health care investing which made up 10% of my portfolio, I needed help with other parts of the portfolio. I could find no retail broker at Sutro that I wanted to trust my portfolio to. I asked and received approval to look for a broker outside of Sutro and contacted Schwab about finding an investment advisor there to manage my account.
While this was in process, the research administrative manager at Sutro called again and said that Sutro was probably planning to shut down the New York office and I would have to move to Los Angeles or leave the firm. Moving to Los Angeles was not an option for me as my roots were deep in New York. I informed her that given this choice I would soon be leaving Sutro rather then moving to Los Angeles and began to think about what to do. I came to the preliminary conclusion that I would start a consulting firm dealing in biotechnology. I also concluded that I would have to carefully manage my investment portfolio.
It was here that I made a major mistake that I have regretted ever since. Frustrated that my money was tied up in Tucker and I was unable to trade in my account and unable to find a broker that I trusted, I decided to open an account at Schwab without a broker managing it. I indicated on the account transfer form that I was self-employed based on the assumption that I was going to be leaving Sutro imminently. This was my Bill Clinton moment and turned out to be a major mistake.
I continued to work at Sutro while I was waiting for the New York office to be closed which I thought would be in a matter of days or weeks and during this time, I began to execute trades in my account at Schwab. However, after some weeks the research administrative manager at Sutro called and informed me that based on the response they had gotten from clients and the work that I was doing that the firm had reversed itself and now wanted to keep the office in New York and they were also willing to hire two assistants to aid me. There was also the promise of a significant bonus in the upcoming review that based on my work could amount to several hundreds of thousands of dollars.
Not surprisingly, I decided to stay on at Sutro instead of leaving and starting my own firm. I then looked for and finally found a Sutro broker that I could trust to help manage my portfolio. The brokerage accounts at Schwab were opened in February of 1999 and transferred to Sutro in April 1999. When I moved my accounts to Sutro the compliance department at Sutro saw that there was this hiatus when I had an unauthorized account at another firm. This was reported to NYSE.
NYSE Reviewed My Case and Took No Action for Three Years
Management at Sutro looked very closely at what had occurred and decided that while it was certainly not something they could condone, it was a minor infraction and they thought that given my stellar and unblemished record that NYSE would not take any meaningful action other than a wrist slap. Sutro decided to be pre-emptive in administering the wrist slap and fined me and suspended me for one month. They thought that this would satisfy NYSE based on their interpretation of what had occurred. They wanted me to continue with the firm, paid the sizable bonus I was due and committed to picki up all legal fees.
I then had a deposition with a lawyer from NYSE in early 2000. During a one day interview, he went over all of the details of the accounts that were held at Schwab and all of the trades that occurred in detail. He also looked at all of the reports that I had issued as an analyst during this time to compare to the trading in my account to the issuance of research reports. I then heard nothing more from the NYSE for three years.
Sutro concluded as did I that this issue was behind us. Three years later in mid-2003, I heard from NYSE to my shock that they were re-opening the case. Why after three years was the case being re-opened? In talking to the lawyers at NYSE, I came to understand that this was the result of Elliott Spitzer’s attack on Wall Street research. Remember the famous case of Henry Blodgett who recommended stocks of investment banking clients to clients that he thought were actually sales.
NYSE enforcement was under pressure because this unethical practice had been brought to light by Spitzer and they had missed it. They were under pressure to show how tough they could be as enforcers. They reviewed their records and came up with my case which they decided to reopen it in order to show that they were aggressive enforcers.
They went over the same information that had been gathered in early 2000, but came up with an entirely different interpretation. They said that I effected stock transactions shortly before issuance of research reports which I had prepared and this was a violation of Exchange Rule 472.40(2) (iii). They also said that I failed to disclose that I held securities in stocks recommended in a research report. They said that I opened accounts at a member firm that concealed fact of my employment at another member firm; violated Exchange Rule 407(b). They recommended a censure and two and one-half year suspension.
Two Stock Trades at Question
The information on opening an account at another firm is something that I just discussed at length. This was not in dispute. However, NYSE focused on two stock trades that I made and explained the suspension largely on the basis of these two trades. I believe that they were clearly wrong in their conclusions. Let me discuss those trades in detail.
The first trade was in Stericycle, a medical waste disposal company. I had been following the company for some time with a neutral rating. In my reports, I noted that the Company wanted to buy the medical waste disposal business of Waste Management and if they were successful, I would immediately go to a strong buy.
This acquisition was announced on April 14, 2009 after the close at 4 PM EST. Because it was 1 PM in Los Angeles I held a conference call with Sutro’s traders and the salesforce and told them I was going to a strong buy on the stock. It was the practice of Sutro to initiate new ideas with a conference call in this manner. The traders and sales force would then go out to the clients with the idea. After this, the analyst would follow-up by publishing a note on First Call (an electronic distribution network) and this was done on April 15 This was then followed up by a written research report on April 16. On April 16, I bought 2500 shares of the stock at a price of $12. This was accepted practice at Sutro for research analysts buying stocks that they recommended. There was no requirement to wait for a period of time to buy the stock. The analyst was allowed to buy the stock at the same time as other Sutro employees and clients
The NYSE judged my conduct on standards that were different from those that were accepted practices at Sutro. By today’s standards, the Sutro practices seem very loose but they were common at the time. This is why Sutro did not view this trade as a breach of conduct and kept me as an analyst. The NYSE also said that I did not disclose that I owned Stericycle in my written report. However, none of the analysts at Sutro were required at the time to do so. This was also standard operating procedure.
Stericycle was a major success for investors. Adjusting for stock splits the stock traded at about $3.00 when I first recommended it. Fifteen years later, the stock is trading at about $119. This was one of my best recommendations ever. I held the Stericycle stock for many years and only sold it recently.
The NYSE did not accept that my actions were in line with the practices of Sutro even though I produced a letter to that effect from the research administrative officer. I also argued that a $30,000 investment in a portfolio that amounted to $5 million at the time was de minimus. I argued that the stock was bought and maintained as a long term investment. I argued that it was an excellent money making idea for investors. The NYSE dismissed all of these arguments and maintained that I traded ahead of my recommendation.
The second trade that the NYSE emphasized was a trade in Schering Plough. On April 18, the stock had traded down by 5%. I had an accumulate rating on the stock essentially telling investors to buy the stock for the long term, but connoting less emphasis than a buy. In the morning call to traders and salesmen, I alerted them to the price weakness, but told them there was no change in the fundamental outlook and there was no change in my price target. I was not intending to issue a report, but the research administrative manager told me that the price drop in Schering Plough based on my price target indicated 25% upside that was the accepted criteria for a buy recommendation. Hence, I needed to put out a report in which I upgraded my opinion from accumulate to buy.
I bought the stock on April 20 at the same time as the written report was issued. I previously owned 500 shares and this increased my position to 1000 shares for a total investment of about $35,000 which again was within a $5 million portfolio. The NYSE again accused me of the same things as in the Stericycle situation. They said that I traded ahead of my recommendation and did not disclose that I owned the stock. My responses were the same as for Stericycle and were once again rejected.
Was The NYSE Action Justified?
I think that the NYSE action was out of all proportion to what actually transpired. I think the enforcement officers applied new standards in overturning the prior decision to take no action on this case that had been in effect for three years. They were under pressure to make a big splash in the Elliot Spitzer era to show how tough they were. My recommendations were solid recommendations and indeed the Stericycle recommendation was outstanding.
I fully recognize that my decision to open the brokerage account at Schwab prior to resigning from Sutro was an ethical breach on my part even if I was planning to resign from Sutro. When I decided to stay with Sutro, I transferred my accounts immediately. I strongly and absolutely maintain that my trading in Schering-Plough and Stericycle was in accordance with policies in place at Sutro at the time. By today’s standards these seem loose, but this was common industry practice at the time.
The NYSE review was conducted by a mediator and it was he that determined the punishment. He had spent his entire career as an enforcement officer for the NYSE. He was also friends with the NYSE lawyers on my case and sent out to lunch with them during the hearing. He was the judge, jury and executioner of my fate. As I look back, I question his objectivity and motives. In writing his opinion, he did not acknowledge documents from Sutro that showed that my stock trading disclosures were in-line with their internal procedures. I had no opportunity to review or correct his opinion in the opinion he wrote. In a country in which, guilt or innocence is established by one’s peers, mine was determined by a hanging judge with no experience in the securities business and an apparent pre-determined view on my actions.