A Glimpse Behind a Closed Door: The Long-Term Investment Value of Buy-Side Research and Its Effect on Fund Trades and Performance
type="main"> <title type="main">ABSTRACT</title> <p>We examine proprietary research produced by buy-side analysts working for a large fund management company. We find that the buy-side research has investment value for a one-year horizon, and the analysts producing this research exhibit differential ability that tends to persist over time. The buy-side research strongly influences trades made by the company's funds, especially when it coveys information that is independent of the fund managers' own information, when it is produced by buy-side analysts with good track records, and when the underlying stocks have little sell-side coverage. The influence of sell-side research is concentrated primarily in stocks not followed by buy-side analysts and in funds with low overall buy-side coverage. The company's funds that rely more heavily on buy-side research generate superior performance.
Year of publication: |
2014
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Authors: | REBELLO, MICHAEL ; WEI, KELSEY D. |
Published in: |
Journal of Accounting Research. - Wiley Blackwell, ISSN 0021-8456. - Vol. 52.2014, 3, p. 775-815
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Publisher: |
Wiley Blackwell |
Saved in:
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