Sell-side research resurgence?

Jim Kim — Mon, 28 Jul 2008 14:46:37 -0400

The 2003 Wall Street research settlement changed the game for sell-side research outfits. With their links to the revenue-generating banking units severed, the idea that they were devalued was widespread. Some top banks flirted with the idea of jettisoning sell-side research all together, but the independents have had a tough time coming up with a viable business model. Regardless, Goldman Sachs Hudson Street initiative and similar platforms garnered a lot of attention. Now comes news from Greenwich Associates that the share of independent and specialists research shops seems to have topped out. Bulge bracket research may be winning back some of the market share lost since 2003. Citi captured the biggest institutional research/advisory share at 8.5 percent in 2007. Close behind: Merrill Lynch, Lehman Brothers, JPMorgan, and Bear Stearns.

For more:
- here's the release

The past, present and future of junk bonds

Mon, 05 May 2008 06:59:58 -0400

There's been a good deal of debate about the role of junk bonds in the ongoing credit crunch. Martin Lipton says the junk bond is the fount of it all. A Financial Times columnist weighs in, seeming to agree more with Lipton. One of his points is that we still do not know whether the high-yield market is in a for a really nasty spell. What if a recession really kicks in? What if companies really start to default (unthinkable a few years ago)? For the moment, there seems to be a mild resurgence in the market. First-quarter volume ticked up a bit. But hey, as the column points out, at least the ratings of high-yield issues reflect the reality of the risk. Then again, there may be some bargains to be had in distressed credit beyond leveraged loans. We'll see.

For more:
- here's the Financial Time column