#SellSideAnalysts #BuySideAnalysts #Finance #StockMarket
Hey there, finance friends! 👋 I’ve been pondering something lately and I’d love to hear your thoughts on it. What do sell side analysts really think of buy side analysts? 🤔 Do they see them as lazy or uninformed because they rely on sell side analysts for insights on companies? And the burning question – who gets paid more in this dynamic?
Here are a few points to consider when diving into this discussion:
– Sell side analysts often have access to a wealth of resources and information that buy side analysts may not have
– Buy side analysts tend to have more direct interaction with company management and insiders, giving them a unique perspective
– Ultimately, both roles play a crucial part in the investment world and bring different strengths to the table
So, what do you think? Let’s dive into this intriguing topic and gain some valuable insights together! 💬 #Investing #AnalystLife #FinanceDiscussion
If you’re talking about research analysts I’d say they’re generally annoyed by buy side analysts (as a buy side analyst).
As it pertains to being informed, I’ve had calls with sell side analysts who have been covering their respective sector for 10+ years and couldn’t answer basic questions.
Buy side analysts probably earn more for the most part, but it varies. If you’re an analyst at a small fund you’re not going to be making as much as someone who’s senior at a BB bank.
I’ve also noticed a shift over the past few years, where sell side research teams have been slimmed down and we have ideas / thoughts on companies being passed along from the trading desks or sales contacts we work with.
Buy side analysts get to say f you before hanging up the phone
There seems to be a lot of confusion here. Sell side analysts barely generate revenue. Buy side analysts make investment calls that drive performance, and are held accountable for that performance.
It should be obvious who makes more money.
I actually am curious what sell side thinks of buy side. Feels like it should be akin to how bankers view PE — with a fair dose of jealousy.
Noone likes to be sell-side, but it is that perverse incentive to weed out the patsies that move to buy-side. Just like short sellers, these sell-side analysts have to be either brave or delusional as they do firm-internal or write for publications. Buy-side has much more moralhazard and it is generally easier to be one as economic cycles imply that market sentiment makes most general shots-in-the-dark ‘correct’, through no talent or effort of the ‘analysis’ done. Sell-side is therefore infinitely more difficult, and much less appreciated. Certainly most investor prospectuses distributed by top analyst firms have larger buy-side reccommendations, as they themselves rely upon the willingness of the whales to come back year after year to affirm their purchases instead of injecting doubt into the mind of portfolio managers. Shorting and selling is therefore demonised unfairly by the public and even within the industry as there are plenty of glass houses
Their questions are less stupid than institutional sales and trading.
Sell side Analysts have deeper understanding of fewer companies/sectors
Buy side Analysts (generally speaking) have more limited access to and understanding of many more companies/sectors.
They generally work very well together to get information and understanding where it is needed for informed investment decision making.
Buy side regurgitates what sell side says and sell side is useless since their recommendations are fully priced in the market. Everyone is copying everyone. Notice how the credit rating agencies almost always have identical talking points
Spent many years on the sell side. I would say opinions of buyside analysts are primarily shaped by their personality. At the end of the day analyzing a company isn’t rocket science, so your brains only get you so far. You will more be remembered as either being nice or an asshole, or (very likely) being painfully awkward or fake nice. The lazy questions or the “what are you hearing” is part of the service agreement.
As far as who gets paid more, it really depends. Risk adjusted I wouldn’t be surprised if sell side actually gets paid more. At each of the bulge brackets there are a solid handful of analysts that consistently make mid six figures to over a mil every year. A lot more beta on the buyside.
Hate
The real question should be what do buy side analyst think of sell side’s
Risk taking > research
HEY MELVIN YOU DROPPED A LOSER HERE PLEASE PICK HIM UP!
Too much analyzing
You can’t really generalize all sell side and all buy side analysts, really depends on firm/asset class/ industry/etc… an IG investment analyst at an insurance firm is technically buyside but very different than someone at a hedge fund who is also buyside.
Heck no, buy-side are more informed than sell-side for the most part. Sell-side is just a glorified marketing department for the bank, yes there are some good sell-side analysts but there are a lot who suck. They have no skin in the game compared to buy-side. If you’re terrible on your recommendations in buy-side you will get fired after awhile but on sell-side if you can get people talking and calling up, you’re winning.
WF analyst who bought 70+ chipotle bowls for DD. That’s was some serious dedication to the game for II votes.
Sell side analysts take in the commissions while buy side analysts use the purchased research to make bad decisions and underperform.
Buyside analysts/PMs are playing with real money.
Sell side analysts are playing with recommendations and commissions.
Each has their place. I’ve met absolute geniuses on both sides, and total morons. The work is similar but different enough that personality and risk appetite plays a big role in determining the best place for an individual.