Investment Research Unbundling: Implications for the Sell-Side

Aite Group analysis shows forced disclosure and unbundling will reshape the investment research industry as the market becomes more transparent and competitive.

Boston, July 20, 2017 — Aite Group’s latest report, Investment Research Unbundling: Implications for the Sell-Side, shows how the unbundling of investment research is causing global brokers to rethink their business model to stay competitive and profitable. Research budget allocations are expected to polarize between integrated providers with top-tier analysts and a select group providing niche expertise, with bespoke research likely to increase.

"Demand may shift away from mainstream waterfront coverage as investment managers seek boutique providers better able to match their research needs,” says Aite Group analyst Spencer Mindlin. “Firms can fill the gap by focusing on their core areas of expertise and delivering bespoke research services that traditional brokerage firms have struggled to provide."

This report is the second in a two-part series that looks at the latest call for unbundling in the European Union and the impacts for the investment-research industry and across sell-side firms. It is based on Q1 2017 Aite Group interviews with global and regional investment managers, independent research providers, and vendors to understand their perspectives and insights on the pending revisions to the Markets in Financial Instruments Directive (MiFID II).

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