Invisage sponsored the Unbundling Uncovered Online conference

Invisage sponsored the Unbundling Uncovered Online last week. It was a virtual conference on investment research organised on 24 June by Substantive Research. The event was attended by over 500 professionals globally from both buyside and sellside. Throughout the day, panels discussed variety of issues impacting investment research and its consumption including Covid-19 pandemic, budgeting and valuation, regulatory changes and product innovation.

Our CEO – Vishnu Thurpati – shared his insights on a panel discussing “The Research Product – how will it change and what are the consequences?”. The panel discussion was moderated by one of our board members – Michael Mayhew, Chairman, Integrity Research. The panel also included Simon Edwards (Head of Business Development, BlueMatrix), Jason Glazer (COO, Cornerstone Macro) Terence Sinclair (Global Franchise Director, Citi Research) Vicky Sanders (Global Head of Investment Analytics, Liquidnet) Alex Coffey, CFA (Head of Research, EMEA, Jefferies).  The panel discussion had over 400 attendees.

Vishnu stated that in the wake of Covid-19 pandemic, product and technology needs to evolve and spur digital innovation that focuses on workflow integration and increased interactivity and actionability. Within the panel, there was growing consensus and expectation that the MiFID II unbundling rules will be relaxed as regulators plan their response to the pandemic, and a growing willingness of European managers to trial new research services that could add value to the investment process. The panellists also observed that there’s a growing disparity between European and US investment managers, with US managers focused on ensuring they had access to research and analysis access to drive investment performance, whereas European managers often under greater pressure to drive down budgets to meet regulatory and cost expectations.

During the conference, ESG and alternative data services also emerged as strong contenders for portfolio managers attention and wallet as they were beginning to see increased allocations. However, buyside firms faced challenges in identifying quality and integrating research into investment processes. Buyside firms continued to identify junioirisation, servicing and integrating vote/interactions data to measure value of research as key issues. Buyside and research providers alike commented that there was more to be done to ensure research servicing and targeting was aligned to user needs and interests

Another theme to emerge was ensuring research coverage is aligned to investment needs and that firms are optimising coverage and quality. Many buyside firms stating there was still further work required for research providers to improve transparency and business model. In past regulators (FCA) have also indicated a desire for an objective research valuation model.

Looking forward, the perception was that while interactions had increased over the past quarter, it would not lead to increased budgets for research. Overall costs of research are expected to remain flat over the next year.

Invisage’s research evaluation report

Invisage also published its Research evaluation report: Sell-side performance under Covid-19 that reviewed research from over 150+ brokers with US coverage. The report shares rankings based on the performance added by research firms during 1 Feb – 15 Jun 2020. The ranks were calculated based on Invisage’s unique smart conviction methodology. 

 

Our Take

Coming out of the conference, Invisage’s view was positive – budgets continue to remain strong, despite the current pandemic, buyside firms continue to see the value and importance of research to drive investment performance and a growing focus on identifying and extracting value from services – paying for quality, while optimising coverage.

We feel ideally placed to help our clients to:

  • Integrate research insights into investment decision making through automated extraction and thematic classification of cross-asset trade ideas across providers.
  • Help research providers better target and service clients.
  • Optimise research budgets as an independent and objective measure of quality and coverage.

If you would like to learn more about our services, or set-up a demo, please contact us on info@invisagealpha.com.

Read about: Invisage’s white paper – Research evaluation report: Sell-side performance under Covid-19

 

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