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Wednesday, 18 February 2015

Happy Chinese New Year!

This is a confusing zodiac. Is this suppose to be the year of the goat or the year of the sheep

Here is a link to explain the difference between the goat and the ram but my view is that since the Chinese zodiac originated from China, it is probably more of a mountain "goat" than a woolly sheep found in New Zealand. 

It is also interesting to note that reference to this animal is usually "negative" in Chinese idioms. I can easily think of a few idioms such as 羊毛出在羊身上, 亡羊补牢, 挂羊头卖狗肉, 顺手牵羊。If you are interested to learn about some of the idioms, the link is here.

I take this opportunity to wish readers a healthy and prosperous year of the Green Wooden Goat.


This post is intentionally scheduled for an auspicious date and time too. 18 Feb 8:08 am. ^_^

Sunday, 8 February 2015

Finally something is being done !

I posted the above picture on my FB page yesterday morning and that picture garnered many "Likes". Frankly it's about time prospectus be written in plain English! There is another interesting article on writing in plain English here.

MAS said in its consultation paper that "You should always draft prospectus with the retail audience in mind as they are the audience with the greatest need for information". The link to the MAS consultation paper is here.

Given that I have diligently read hundreds of prospectus since July 2007, I think my views should be heard too since I am the retail user they are targeting ^_^

If you think about it, what I am essentially doing at my blog is to read through the prospectus, sift through the pages to look for material information and then summarize them in an easy to understand format. Of course, more importantly, I tell you whether the IPO is chilli hot and the possible fair value range. 

Let me share with you why the prospectus are so difficult to read and can cure people with acute insomnia

Prospectus are written by lawyers...

In my line of work, I have worked with many lawyers. Lawyers are trained and paid to "cover all angles of risks". 

In order to prevent their clients from being sued by investors in future for non-disclosure, all risks (no matter how immaterial) will be listed as a potential risk in the prospectus. As such, half the time, the risk factors in the prospectus are purely "CYA"  stuff written in convoluted legalistic jargons. 

Proposed changes is definitely great news for investors

The proposed changes include:
  • write in plain English without jargon
  • present information in a clear, concise and logical manner
  • avoid legal and financial jargons
  • write in active rather than passive voice
  • use short sentences 
  • write in personal pronouns
  • avoid multiple negatives
  • use tables, charts and graphs 
  • use bullet points, examples and descriptive headings
  • keep prospectus as short as possible and remove redundant information

Examples of proposed changes 

I have gone through the detailed consultation paper. It is definitely a huge step forward in the right direction. You should support it too!

Public may submit their feedback to MAS by March 13 to

but the bigger problem which MAS should quickly address is the IPO famine in Singapore.

While it is good that retail investors can start reading prospectus written in plain English,  what is the point if there are no meaningful IPOs to begin with.... Isn't it time MAS and SGX do something about this? Mr. IPO has been "jobless" for quite a while already... 

What happened to the past consultation paper?

Now i suddenly remember SGX consultation paper in October 2012 to allocate more shares to retail investors, especially if the IPO is chilli hot. Isn't that long over due too?  Perhaps some kind readers can remind MAS to remind SGX....

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