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jerryking : research_analysts   7

Big Investors Don’t Want Wall Street Analysts Snooping on Them - WSJ
June 14, 2018 | WSJ | By Telis Demos

the research shops are finding ways to make up the lost revenue, turning to readership data. They do say that information is power, and in this case I guess the banks have the power again.
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I think the WSJ is conflating two very different issues. The privacy concerns apply on ethical (possibly criminal) grounds rather than moral ones, in the example given of hedge funds asking a broker to provide aggregated readership data. It's very hard to imagine a responsible research provider doing this. The other piece - the tracking of utilization of research product is exactly what brokers need to do to ensure they are being paid appropriately for the level of service a client is receiving. MiFID 2 has and will continue to put pressure on how much research clients consume, and to precisely account for how much they pay for it. Transparency is a two-way street. A 90-day embargo on the readership data is a simple solution, as quarterly/bi-annual reviews should suffice to true-up the bank/client ledger.

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behavioural_data  investment_research  institutional_investors  reading  research_analysts  snooping  traders  Wall_Street  buy_side  informational_advantages  privacy  transparency 
june 2018 by jerryking
Today’s Titans Can Learn From Fall of U.S. Steel - NYTimes.com
JULY 3, 2014 | NYT |By FLOYD NORRIS.

it was the run-up to that strike, as well as the eventual terms of the settlement, that paved the way for the decline of the company and the industry it led. The episode opened the door for surging imports and eventually for wage increases that the companies could ill afford...The United States economy is no longer so dependent on heavy manufacturing, a development that would have taken place even if the men running U.S. Steel had far more foresight than they did. But they might have coped with it far better than they did. They might have found a way to better use newer technology that enabled companies like Nucor, which remains in the S.&P. 500 and whose market value is four times that of U.S. Steel, to prosper making steel.

More broadly, the descent of U.S. Steel from all powerful to also-ran might be worth contemplating by those who now seem to be astride the world economy, a list that could include companies in Wall Street, Silicon Valley and China.

Michelle Applebaum, a now-retired steel analyst whom I have relied upon for insights since the 1980s, when she was at Salomon Brothers, says that one reason the 1959 strike proved disastrous for the big steel companies was that it showed customers they had choices...When the strike did end, workers received minimal wage increases, but they also obtained a cost-of-living provision to ensure that wages and benefits kept up with inflation. That would prove to be valuable for them in later years. Steel users had learned how to deal with imported steel, a lesson they did not forget.
steel  lessons_learned  '60s  unions  labour  S&P  JFK  strikes  history  Salomon_Brothers  U.S._Steel  cost-of-living  Nucor  imports  research_analysts  foresight  decline 
july 2014 by jerryking
How to tell good buys from bad: Talk to people, trust your gut
Jun 3, 2006 | Globe & Mail | by Avner Mandelman. 2 mths
ago Giraffe put an ad in RoB, looking for a research analyst. We asked
for a 1-pg. résumé, a half-pg. letter, and a 1-pg. tech stock pick/pan.
All presented themselves well, and some even gave interesting stock
picks/pans. Two things were missing: First, nearly all had based their
analysis on public, 2nd-hand data -- the kind that everyone else sees
also. Very few did primary field research and none thought it important
to highlight exclusive info. Instead, the recommendations were rife
with data copied from the Web, corporate filings or famous analysts'
reports. The interviewees saw their role as financial scientists
massaging data gathered by others, rather than gatherers of exclusive
info themselves. Second, very few spoke of the company's people: the
character of their pick's CEO, the trustworthiness of the CFO, or the
high integrity of the company's team viz. a viz the competition. This
lack of people-mention was glaring.

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A technique for finding out information about companies. When you talk to people , you do not ask them to talk about their company. What you do is ask them to talk about the other company. That is not reg FD or insider information per se. It is their observations on the generalized business conditions and what the other companies are doing. Folks like to shoot their mouths off about other people
Avner_Mandelman  research_methods  hiring  sleuthing  due_diligence  proprietary  exclusivity  primary_field_research  secondary_research  research_analysts  gut_feelings 
february 2010 by jerryking
Follow successful investment managers, you'll learn from them
August 13, 2005 | Globe & Mail ROB pg B7 | by Ira Gluskin.
"The first question that you should ask is why does anyone in the
investment industry want to be interviewed or quoted?...A tip to
facilitate your newspaper reading productivity... The most important
articles to read are by, or about successful investment managers.
Articles by or about investment executives and corporate executives come
next. Research analysts should be read afterwards. The last experts to
rely on are economists, with one notable exception. Jeffrey Rubin of
CIBC.".......Avoid all the articles interviewing Mr. and Mrs. Average Canadian who want to share their investment expertise with us. Certainly there are many astute investors out there in the real world, but the real world is full of experts on sports, movies and politics as well. However, the editors of these sections do not choose to air these amateur views like they do in the financial section. I repeat that I recognize that there are brilliant investors out there, but they don't have the discipline of achieving reported performance numbers like myself. This lack of discipline prevents the reader from knowing whether they are dealing with lucky or smart people.
Ira_Gluskin  investment_advice  in_the_real_world  Jeffrey_Rubin  Gluskin_Sheff  money_management  wealth_management  high_net_worth  Toronto  Bay_Street  reading  productivity  howto  economists  investment_research  equity_research  research_analysts  worthiness  discernment  smart_people  luck  investors  self-discipline 
october 2009 by jerryking
FT.com / Wealth - Star performer’s secret: he is smart
November 13 2006 12:26 | Last updated: November 13 2006 12:26
FT.com By John Authers reviewing Anthony Bolton's "‘Investing with
Anthony Bolton – the Anatomy of a Stock Market Winner’, by Anthony
Bolton & Jonathan Davis. Harriman House Publishing, £12.99."
book_reviews  stocks  equity_research  stock_picking  investing  stockmarkets  books  research_analysts  smart_people 
march 2009 by jerryking
Information Haves and Have-Nots - WSJ.com
Sept. 22, 2008 | Wall Street Journal | by L. Gordon Crovitz.
Piece on the ramifications of not having access to good information has
had on pricing securities. No one asks the right questions as research
analysts desert Wall Street.
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...The credit crunch can be reduced to a single word. Not "greed," which also exists in stable markets. The word is "information," the absence of which has put taxpayers on the hook for billions, ruined Bear Stearns and Lehman Brothers, and led to the fire sale of Merrill Lynch and AIG. The continuing absence of information about the true value of underlying securities means no one knows when the market has hit a new normal for the important purpose of rebuilding.

Why did so many smart people at so many top firms make dodgy investments? Why were there so many unknown unknowns, now at least becoming known unknowns? One explanation is the absence of warnings from research analysts. For decades, the large Wall Street brokerages had armies of analysts who, when they did their jobs right, asked the hard questions and issued tough reports that often alerted both company executives and public investors to market-moving issues.

There are now about half as many Wall Street analysts as in 2000......."Research analysts have gone the way of high-button shoes and buggy whips." Alas, unknown risks have not. The now-former senior executives at Bear Stearns, Lehman and Merrill must wish they had been able to retain all their star banking analysts. Those analysts just might have waved enough red flags -- in public or even in the hallways of the banks themselves -- to alert management to risks in their portfolios......a few of those analysts left these Wall Street firms for the "buy side," such as hedge funds, which keep their research proprietary, for their own trading. Predictably, it was well-informed short sellers at these firms who first alerted the market to the true value of credit derivatives and other mispriced instruments by driving down shares of firms such as Lehman.

At a time when real understanding is at a premium, we're increasingly in a world of information haves and have-nots......A corollary is that proprietary information will be more valuable than ever, giving well-informed traders an even bigger edge.

What's the solution? The temporary ban on short selling of financial firms will have the unintended effect of worsening the information gap. Professionals will perform the equivalent of short selling through nontransparent instruments and markets, leaving individual investors to be guided by public share prices that no longer reflect all known information......Part of the answer came in news earlier this month that Credit Suisse will make macroeconomic research from its analysts available to noninvestor clients of Gerson Lehrman Group, a powerful force in the world of independent research such as for hedge funds. Equity researchers from Credit Suisse joined the some 200,000 expert consultants that Gerson Lehrman has attracted to its network.......Clients of Gerson Lehrman pay hefty fees to tap this deep knowledge through one-on-one phone calls and meetings. Serving these clients will help Credit Suisse fund its 700-person research department.

When Gerson Lehrman launched a decade ago, it was to serve the deep information needs of investors in highly technical areas such as health and biotechnology. As Wall Street analysts began to leave the scene, it brought on experts in virtually every industry globally, with 150 research managers to help clients conduct more than 10,000 consultations monthly. These are often on arcane topics, such as the likely growth in salmon farming in Norway, or the odds of success for a particular drug trial. Perhaps some research was even done on, say, the proper pricing of derivatives.

Regulators can try to put genies back in bottles, but complex financial instruments that, when properly used, create value will only become more commonplace. Innovation will also be required for better-informed markets. By recruiting a huge number of experts and using online social-media tools to connect them to clients, firms like Gerson Lehrman can bring information, knowledge and insights to the people who most value and need it.
arcane  asking_the_right_questions  buy_side  equity_research  expert_networks  financial_instruments  Gerson_Lehrman  hedge_funds  information  information_gaps  information-poor  information-rich  L._Gordon_Crovtiz  market_intelligence  proprietary  regulators  research_analysts  selling_off  short_selling  uncertainty  unintended_consequences  unknowns  Wall_Street 
january 2009 by jerryking

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