5. Executive Traits Are a Revealing Investment Gauge

A critical part of the investment appraisal and company evaluation process is gauging management effectiveness, quality, character, and values. Surprisingly, this essential aspect is often disregarded by the Street, unconcerned with character differences among the companies it covers. In crucial moments when events panic investors and stocks nose dive, executives are usually temporarily incommunicado. The ultimate basis of a judgment call in those circumstances is whether management can be trusted. It also holds true over the long-term. Who would you rather invest in, trustworthy or cagey executives? You need to get a handle on executive values in companies where you have an investment.

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