WRONG TURN ON THE I-WAY?
Regarding "Online investing" (Cover Story, June 5), communicating with analysts by telephone can be risky enough for management, but analysts on the Internet may well present an even greater and potentially more dangerous problem.
Even in cyberspace, companies are likely to be held responsible for updating and correcting any material information previously disclosed that is still considered "live" and which has become misleading. Moreover, although the Internet audience is presumably infinite, the courts and the Securities & Exchange Commission may view disclosures made here as "selective" because they are available only to the "wired" elite.
The vast and unfamiliar territory of the Internet is enough to send shivers down the backs of corporate securities counsel. Given the uncertainties regarding projections disclosed in traditional venues, the changed environment requires that companies be meticulously careful in navigating, or avoiding, the Internet.
Maryann A. Waryjas
Jenner & Block
Your story provided very little in the way of worthwhile information for any type of sophisticated online user. If the intention was to educate the masses about online services, forget it! Most people still can't program their VCR or do more than reheat coffee in a microwave. How can you expect them to get a handle on online services--except to make ill-informed investment decisions? If you go with a cover story, provide some meat along with the bones.
Lawrence M. Stern
Gary Weiss's article on online investing, and particularly the caption, misrepresented my relationship with the companies that I write about, therefore unfairly raising questions about my reliability. I would like to make the following points: (a) Hot Stocks Whispers and Confidential are solely supported by subscribers and not by any companies. (b) Hot Stocks Review and Whispers or Confidential are different publications. (c) Hot Stocks Review is mostly composed of Whispers in terms of sheer bulk and daily activity. (d) I advised subscribers in late January to take their profits on Luminart when the stock sold at $9.75 (Canadian)--it peaked at $10.125 and then crashed. (e) I have written about three Canadian over-the-counter stocks out of more than 200 stocks I have reviewed over the past year. (f) The dough does not keep rolling in from companies, and the bulk of the money comes from subscribers.
Editor's note: Chelekis' descriptions of the newsletters' relationships do not contradict the story. The Canadian over-the-counter issues mentioned in the story refer to those trading in the U.S. Chelekis said in interviews for the story that the bulk of his revenues comes from companies.
The reason why Wall Street firms shun the Net is that their franchise--selling analysts' research to John Q. Public--is now technologically obsolete. As an investor, I want real-time updates on positions I hold, not quarterly mumbo jumbo that the big dealers put out (usually as a favor to their corporate finance departments). I get this on the Net. As for George Chelekis, thanks to him, I've returned a meager 106% on my eight-month portfolio. Wish I had followed more of his picks.
Carson J. Wynne