Canadian Boutique Mackie Research Had Top 2019 Buy Recommendation Performance


The top performing equity research buy recommendations for the three-year period ending December 31, 2019 came from Toronto-based Mackie Research Capital Corporation, according to performance information collected by Investars, a research performance measurement and commission management systems provider.

Investars collected performance data on 127 research providers for the period from January 1, 2017 through December 31, 2019, on which we have based our analysis.  Investars calculates buy recommendation performance by tracking the buy recommendations as if an investor had invested equal amounts of cash into each stock in the research firm’s buy portfolio. A buy remains a buy until changed to a hold or a sell.

Top Performers

Mackie Research Capital Corporation, which employs five senior analysts following approximately 100 small- and mid-cap stocks, had the best 3 year buy performance. Mackie Research’s recommendations were accompanied by extremely high levels of volatility, with a 34.3% standard deviation which was over twice the volatility of the S&P 500.   However, Mackie’s maximum drawdown of -19% was the lowest among the top fifteen performers, and less than the -20.3% maximum drawdown for the S&P 500 and the -25.7% drawdown for the Investars universe during the period.  According to Investars, the firm had only ten buy recommendations and one sell during the 12 months ending December 31, 2019.

Equity Research Firms with Top Performing Buy Recommendations for the 3-year period ending December 31, 2019

FBN Securities, a NYC-based institutional broker mainly covering the technology and media sectors, had the second best buy recommendation performance for the period.  SVB Leerink, a Boston-based investment bank focused on the healthcare sector, had the third-best track record for its buy recommendations.

The top fifteen firms had better aggregate performance for their buy recommendations than the S&P’s 14.6% total return for the three years ending 12-31-19.  However, it is important to remember that the performance analysis does not include transaction costs.

Eleven of the top fifteen firms were investment banks.  Second-ranked FBN Securities, behave (#7), Monness Crespi (#12) and Atlantic Equities (#13) do not offer investment banking.

Market Performance

The S&P 500 ended the year with a strong finish, up 8.5% for the quarter (9.1% with dividends), its best fourth quarter since 2011.  The index posted 22 new closing highs and ending the year with a pleasingly broad 28.9% gain (31.5% with dividends).  For the decade the index had an 11.2% annualized rate (13.6% with dividends), as the longest-running bull market continued (from March 9, 2009), with the help of low interest rates and resilient consumer spending.  For the year, all sectors were in the black.  Energy was the only sector with single digit returns (7.6%).  Information Technology was the best performer for the year (up 48%) followed by Communication Services (30.9%) and Financials (29.2%).


Of the top fifteen research providers during the period, Luxembourg-based independent firm behave had the lowest volatility for its buy recommendations (15.8%), but not lower than that of the S&P 500 (14.8%).  Top-ranked Mackie Research had the lowest maximum drawdown, -19%.

Duration of Buy Recommendations

Monness Crespi, Hardt & Co. had the longest average duration for its buy recommendations, averaging 11½ months for its recommendations. William Blair had the second longest, at just over 11 months.  Quant firm behave had the shortest average length for its buy recommendations, at 2.6 months.  Except for behave, the buy recommendations of all the top fifteen providers had average durations longer than the Investars average of 8.6 months.

The longer the holding period, the more likely the firm’s performance can be captured by investors following its recommendations. Also, longer holding periods represent lower trading costs.

Sell Recommendations

On average, sell recommendations for the top-performing investment banks represented 4% of their total buy and sell recommendations, whereas for the top-performing independents, sell recommendations represented 20% of the combined recommendations. For behave, sells represented the majority of its recommendations.

One Year Returns

The last three years have been a generally positive environment for stocks, including the last twelve months. Therefore, it is revealing to examine the 1-year returns.  Mackie Research had a 90% 1-year return, while the aggregate 1-year return for the top-performing research firms exceeded the S&P 500’s twelve-month returns.

Our Take

Risk-off market performance tends to favor small-cap stocks, benefiting stock pickers who focus on the small-cap sector.  Most of the top-performing research firms for the three-year period ending in 2019 offer extensive small-cap coverage, including firms such as Needham, William Blair and Robert Baird.  On the flip side, the performance of small cap stocks is generally more volatile, and small-caps are more vulnerable to recessions.


About Author

Sandy Bragg is a principal at Integrity Research Associates. He has over thirty years experience as an investment research professional. Prior to joining Integrity in 2006, he was an Executive Managing Director at Standard & Poors, managing S&P’s equity research business and fund information properties. Sandy has an MBA from New York University and BA from Williams College. Email:

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