keeping-a-cover-on-stocks

Keeping a cover on stocks

Brad West of Amba Research talks about how the financial crisis is diminishing research coverage and providing opportunities for independent research houses.

By Daniel Inman

November 24, 2008

The financial crisis is going to make it harder to find out about companies to invest in. The current cyclical downturn, combined with a long-term negative trend towards research, means one thing ôWe're going to see the number of companies covered by research departments of brokers drop precipitously over the next six months,ö says Brad West, co-founder and managing director of Amba Research, a provider of investment research support services.

He outlines the following situation the trend in equity research coverage has been negative since before the dotcom bubble burst in 2000. ôUntil 2007, however, strong cyclical profitability û including, improbably, the cash equities business for several consecutive years û allowed banks the luxury of...

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