We believe that research is an integral component of a functioning equity market. We believe that research should be thorough and sometimes even provocative. Have a look at the graphs below. All data come from Bloomberg (a dispassionate data source) as of December 1st.
Stocks covered in STOXX600 and % of BARR 1
AlphaValue Baader has more stocks consistently under coverage where our ratings perform the best (BARR 1). One can find equity, credit and ESG research on all our stocks. This is because we are a traditional equity research house where independence is at the core of our DNA. We use a standardised approach for all our stocks to eliminate biases. It also makes all our research consistent. All data used is proprietary with no external source of data. We are truly independent, we do no execution, no corporate brokerage or no M&A. Our only source of income is subscription and fees paid by asset managers so you can be assured that there is no conflict of interest.
Stocks with Negative Ratings
As you can see, we have negative ratings more often than others. This is because we do not tweak target prices or recommendations. We have a robust stock selection as demonstrated in our lists (Active, Buy & Hold and Short & Hold). This is also another example of independence. Unlike banks who provide research but at the same time, financing services to issuers (IPO, loans etc.), our loyalty is just towards our subscribers.
In recent times, we have seen this happen with banks and their lack of independence. Take the Credit Suisse story where Credit Suisse hired over 20 of the largest banks for their CHF4 Billion capital increase. The practical impact is that out of the 20 analysts that used to cover Credit Suisse, many ended up becoming restricted and the bank analysts you used to rely upon will not be available to discuss the story, arguably at the moment you need them the most. This is why the independence of banks is often questioned.
This is another reminder of one of the benefits of Independent Equity Research provided by AlphaValue. Because we derive no revenue from corporate banking or corporate services, our analysis is unbiased and always available to our clients.
AlphaValue provides unbiased, reliable and independent equity research. We believe that this is key to ensuring market integrity. Find out more about us here.
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