Code of Ethics of Blue Gem Research (Pty) Ltd:

Besides the standard morals and ethics of our industry, we note three particularly important ethical principles that Blue Gem Research (Pty) Ltd and its staff, directors and officers all subscribe to:

1. We will never “front run” our research. From the moment that a company signs for coverage, we will not trade (buy or sell) in that company’s shares until such time as the report has been published on this website and is available to the public. In the case of maintenance reports (e.g. results notes), we will not trade in the respective company’s shares during the period from when the results are released on SENS on the JSE until we have published related results note on this website and it is available to the public.

2. We will disclose our collective holdings in the relevant company that we own at the time of publishing the report. Refer to the disclaimer at the end of each report for the disclosure of holdings at the date of publishing. Note that this disclosure reflects only a point in time, though, and subsequent relevant holdings may have changed.

That said, we find that independence is an often overrated (and actually quite rare…) commodity in the stock market. Rather, we believe it is quite important to “put your money where your mouth is“.

If an analyst or investor has a positive view of a stock but has not bought it, isn’t that a contradiction?

Hence, so long as we do not front-run and remain ethical in all our activities, we firmly believe that any personal positions in stocks that we cover should serve as strong evidence of our confidence and convictions in our rigorous research process and investment opinions.

In our view, “skin in the game” counts far more than independence.

3. While we have sold our “appearance” of independence by offering commissioned research, we will strive to act independently. Our contracts for coverage of a company include a clause specifically stating that we cannot and will not give the company any guarantee, warranty or similar such assurance regarding our forecasts, valuations or any subjective opinion we have concerning them. We intend to stick fast to that clause, even at risk of losing a paying company under our coverage.