Your Questions About Successful Trading Companies

George asks…

Which fur trading company was most successful in the early 1800s and why? (can be your opinions)?

John answers:

Hudsons Bay Company, etc. Here is a good article on the situation.


Ken asks…

Publicly traded companies and conflict of interest?

Do public companies typically have conflict of interest policies that would restrict employees from owning shares of another company which they have significant purchasing influence? Let’s say you are a manger on a team that makes the decisions affecting whether your company buys from vendor A or vendor B. Vendor A is an established public company but vendor B has just had a successful IPO. Your company is in Vendor Bs list of top five customers in sales. Your teams’ decision could affect Vendor Bs sales for the year. Can you as an employee own stock in Vendor B? Could this be viewed as a conflict of interest? Do companies have policies set up to restrict this kind of activity?

John answers:

Most public trade companies would consider this a conflict of interest and would probably have a prodedure to deal with it. I believe the non-declaration would be the key point and that having shares is ownership. Whether you use this influence i not so important as the fact that you could effect important decisions. The company itself has to be audited and live within legal rules which can prove to be very costly if it goes outside. Declaration therefore would be essential in my view.

Paul asks…

Have any famous or successful people ever did their own Initial Public Offering?

Has anyone in the USA, as an individual, ever successfully raised capital through an investment bank and launched their own publicly traded company. Say, someone who had very little of their own capital to begin with?

John answers:

An IPO is very expensive to get done as there must be not less than three years of audited financial as well as prospectus written and then compensation to the investment bank even for due diligence

James asks…

Which companies stock should i buy?

I have to do a project for Econ class and we have to trade stocks and stuff, which companies do u think will be successful, which companies did well in the past couple of months? (BESIDES APPLE) and these stocks have to be in the NYSE, AMEX, or NASDAQ

John answers:

SWIR, Sierra Wireless, they provide wireless technology to Verizon and Sprint; growth in wireless technology is increasing

Thomas asks…

Is a company that has lost money for years & whose stock has declined from 131.00 to 0.86 “successful”?

Someone told me that “Plugpower is a successful fuel cell company, stock trades on the NASDAQ”. says Plug Power Inc.(Public, NASDAQ:PLUG) lost money in 2007, lost money in 2008, and lost money in the first quarter of 2009, and that the stock was trading at 131 in 2000, 7.54 in 2005, 2.91 in August 2008, 0.69 in October 2008, and 0.86 today (July 2, 2009).

Is it reasonable for someone to call this “successful” or was the person who told me that “Plugpower is a successful fuel cell company” being less than honest?
The company is involved in new technology that is in development.

The person was not suggesting that I buy the stock. The person had a different reason (which I am not disclosing here) for wanting me to think that the company was doing well.

John answers:

The person who told you that the company is successful is probably someone who bought the stock with the sole intend of pumping up the story to gullible people in the hopes that they will buy the stock, pump the price up and then that person can dump their shares, its a classic scheme in penny stocks called the “Pump and Dump” (if you want to see an exaggerated example of this scheme watch the movie “Boiler Room”). The person was not counting on you actually doing your homework on the stock, thankfully you are a smart investor and actually have healthy skepticism on these types of things, I only wish more people where that smart when it came to penny stocks. : )

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5 Responses to Your Questions About Successful Trading Companies

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