CEO letters are written to be read

In the midst of earnings season, it seems appropriate to talk about the importance of letters provided by CEOs and how they can shape not only price but also the continued growth of a business in an Investor's minds. When trading a public company, almost everything must be disclosed often after the compliance team, and auditor and perhaps a proofread or even two are conducted.

While those provided much-needed insight into a company's performance and general health, it is the optionally included letter from the CEO that can often sway prospective and current investors' hearts and minds. The letters are generally penned with thought-provoking curiosities and can lead an investor into ultimately making a decision on whether to buy, hold, or sell.

These letters' purpose is usually for transparency, providing an honest focus of the CEO on the core principles of the company moving forward over the next financial year or quarter. They can sometimes divulge more than necessary or from an extensive base. But regardless of the letters key components, its about getting into the head of the person at the helm.

CEO letters are not just read in a company memo, nor are they only digested by investors, in recent times watchful spectators have joined the library. As time has gone on the CEO Letter has become more and more critical when weighing in on an investment decision.

In my eye's warren buffet provides the gold standard of the CEO Letter. He is clear and concise with enough commentary to feel as if you were present in the moment of writing, and as such, they are not just a simple corporate communication tool.

So next time you see the memo for a CEO letter, take the few minutes to read how the big wig at the other end of the pen (or keyboard) feels about business in their world.