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Press ReleaseSpending on Independent Research Projected to Grow 112 Percent in Next Five YearsDARIEN, Conn., March 10, 2006 -- Institutional investors are projected to spend almost $3.1 billion on independent equity research in 2009 - a surge of more than 112 percent from the $1.47 billion that was spent in 2004.This forecast is included in a newly released research report titled the 2006 US Equity Research Industry Outlook, written by Integrity Research Associates, LLC. This comprehensive 325-page report describes the key developments in equity research during the past decade; analyzes the forces behind these changes; outlines the most critical challenges facing the three major sources of equity research - sell-side firms, buy-side firms, and independent research firms; and forecasts the market's growth over the next five years. Also included in this year's report are concise one- to two-page profiles on nearly 200 of the most prominent independent research providers in the marketplace today. "One of our key findings is that the independent equity research industry is undergoing a seismic shift that will produce both winners and losers in the coming years," notes Michael W. Mayhew, CEO of Integrity Research Associates. "Our analysis shows that the marketplace for independent equity research will continue to grow in the coming years as institutional investors search for reliable sources of profitable investment ideas." Along with projecting a surge in research revenues over the next few years, Integrity estimates that independent research firms will see their share of the equity research market rise from 15.8 percent in 2004 to 26.2 percent by 2009, reflecting gains in institutional, corporate, and retail expenditures. Mayhew warns, however, "Not all independent research providers will benefit from this rising tide as increased buy-side reliance on internal research, more direct competition from sell-side firms, and the trend towards unbundling research from execution will prompt asset managers to take a hard look at what research they are using and how much they are paying for it." In fact, Mayhew explains, "We expect these pressures will force a number of independent research firms to merge with other larger players, or exit the business altogether." Integrity projects that the number of independent research firms will fall 65 percent from 425 in 2004 to 150 firms in 2009. Integrity Research Associates, LLC, is the premier ratings, analysis, and consulting firm for the equity research industry. Integrity publishes syndicated research reports; provides an online database of research firm reviews, analysis, and ratings; and offers consulting services to banks, money management firms, broker/dealers, and hedge funds. For more information on how to purchase this research report, go to http://www.integrity-research.com/2005erio.html. Press Contact: Michael W. Mayhew Integrity Research Associates, LLC 888-757-4011 Michael.Mayhew@integrity-research.com |
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