The end of investment research as we know it

Author: Amélie Labbé | Published: 31 Jan 2018

The days of investment research as we know it could be over if recent developments in the market are looked at more closely.

The new Markets in Financial Instruments Directive (Mifid II) aims to democratise the research process by separating this provision from the execution of a transaction: put simply, this means payment for research cannot be linked in value or in volume to the placing of a trade.

The separation of the research from the trade execution is a drastic move for an industry that has historically relied on seemingly free and abundant investment reports as revenue from the trade was used to fund the research. 

What future for investment research?Both fund managers and research providers have felt the consequences of this unbundling, not least because the new rules mandate more transparency on how research is priced, what it covers and who exactly is paying for it. ...