StarMine awards rank analysts against their peers based on earnings calls and returns

StarMine measures the performance of analysts based on the returns of their buy and sell recommendations and the accuracy of their earnings estimates. The 2007 awards are based on the 2007 calendar-year performance of recommendations and estimates of companies that are based in Hong Kong and China.

The awards are based on the estimates and recommendations as recorded in the Thomson Financial I/B/E/S database.

StarMine uses the Global Industry Classification System for its industry definitions.

In some instances in Hong Kong and China, the GICS has resulted in industries that are not large enough for ranking purposes. When this has been the case, StarMine has combined multiple industries to reflect the way analysts organise their coverage.

Analysts are ranked according to their industry excess return, computed from a portfolio simulation that measures each analyst relative to an industry-based benchmark. All analyst returns are calculated relative to the return on a market-capitalisation-weighted portfolio of all the stocks in a given industry.

For comparison purposes, StarMine builds a non-leveraged portfolio for each analyst based on his or her recommendations. The result gives the analyst credit for the amount by which the stock outperformed the benchmark. The resulting portfolio is rebalanced each month and whenever the analyst adds coverage, drops coverage or changes a rating.