Buy-Side Spending on Most Types of Research Expected to Drop in 2022


According to Integrity Research’s annual research industry outlook, spending by global asset managers on sell-side and independent research is expected to fall 4.3% in 2022 – marking a modest reversal of the jump in investment research spending seen in the prior year as equity trading volumes surged in the US in 2021 boosting research payments.

Integrity 2022 Research Industry Outlook

Buy-side spending on sell-side and independent investment research is expected to fall 4.3% to $13.9 bln in 2022, according to Integrity Research’s annual Investment Research Industry Outlook.  This represents an 18.0% drop in annual research expenditures from the peak spending level of $19.98 bln seen in 2015.

While spending on sell-side and independent research in Europe is expected to decline as asset managers continue to shrink their research budgets in response to MiFID II, US asset managers will also spend less on research in 2022 as firms reduce their spending in 2022 following the surge in equity commissions and bundled commission payments for sell-side and independent research seen in 2021.  According to our forecast, buy-side spending on sell-side and independent research in Europe should drop 5.7%, spending in North America will fall 4.6%, and research spending in Asia is expected to fall 1.9% in 2022.

Spending on sell-side research is expected to drop $555 mln or 4.5% in 2022 from $12.31 bln to $11.76 bln.  The region we expected will record the greatest weakness in 2022 is Europe where research spending is expected to decline 6.0% as most asset managers remain cautious as the continue to fund research from their P&Ls.  US asset managers will decrease their research spending by 4.6% in the wake of the surge in bundled research payments seen in 2021.  Spending on sell-side research is expected to slip 2.0% in Asia in 2022.

Buy-side expenditures on independent research is expected to fall 3.0% to $2.16 bln in 2022.  Spending in North America should drop 3.0%, while spending in Europe is expected to fall 4.0% and Asian expenditures should dip 1.0%.  We project that spending on independent fundamental research will slip 2.0%, while spending on independent macroeconomic research will drop 15.5%, and spending on independent quantitative research will slip 7.4% in 2022.  Despite weakness in most independent research categories, buy-side spending on primary research – particularly from expert networks – is projected to actually increase 3.4% in 2022.  Consequently, the market share for primary research (expert networks, channel check providers, survey vendors, etc.) rose 2.5% to 46.5% in 2022 as asset managers cannot obtain this type of research from their sell-side counterparties.

While the bulk of the $13.91 bln that asset managers spend on investment research is spent to pay for fundamental equity research (a majority of what they pay to the sell-side is for this type of research), institutional investors now spend more on primary research from IRPs ($1.0 bln) than any other type of research they obtain from other types of independent research firms.

The Future for the Research Industry?

While research spending rose modestly in 2020 and 2021, the decline we forecast in 2021 has prompted some to wonder whether we expect continued deterioration in the research industry over the next few years?  The answer is “not necessarily”.  We do expect to see asset managers continue to spend less and less for non-differentiated  research.  This is particularly the case as many asset managers are now spending their own funds for sell-side and independent research.

However, we do believe that the market opportunity for innovative research services is actually growing.  We have seen many buy-side firms increase their spending on unique third-party research and data products including expert networks, ESG research, crypto research, research on under covered companies, AI data driven insights, and various alternative datasets.  This has driven an increasing number of sell-side and independent research firms into these areas.

In addition, we have seen a growing number of research providers and alternative data firms look to expand their businesses by marketing outside the traditional buy-side.  Many macro and policy research firms, expert networks, channel checkers, and alternative data firms have increased their focus on serving corporate customers, PE and VC firms, and even strategy consultants.  In fact, a number of research firms are refusing to serve hedge fund and mutual fund clients due to the competitive nature of these markets and the high cost of serving these demanding clients.

Consequently, we doubt that the investment research industry will look very much like the market we saw 10 – 15 years ago.  Instead, we suspect that firms that innovate their products, expand their client bases, and enhance their expertise are the ones who are likely to win, while other research firms are likely to continue to lose market share.


About Author

Mike Mayhew is one of the leading experts on the investment research industry. In addition to founding Integrity Research, Mike is on the board of directors of Investorside Research Association, the non-profit trade association for the independent research industry, and a frequent speaker on research industry trends and developments. Mike has over thirty years of research industry experience. Email:

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