More Research Consolidation


ThinkEquity LLC is shuttering its equity group, including research, because of the declining commission environment.  The firm employed a total of about 100 people, including 15 senior research analysts, primarily in the technology sector.

“It’s an impossibly tough business,” Chief Executive Officer Greg Wright said in an interview with Bloomberg. “Spreads are compressing, of course, but volumes have collapsed. There aren’t enough commission dollars today for the number of market participants so there will be further consolidation.”

Average daily volume for U.S. equities was 6 billion shares in the third quarter, the lowest since at least 2008.

Nomura Holdings Inc., Japan’s biggest brokerage, cut as many as 30 jobs in its Americas equity division in September.  Auriga USA, a division of Spanish bank Auriga Global Investors Sociedad de Valores SA, closed its equity-trading and research division earlier this year for similar reasons.

According to an article in the Wall Street Journal, Rodman & Renshaw has mostly wound down its equity trading and research division and has changed its name to Direct Market Holdings Corp, though it still lists equity-research coverage of life sciences and healthcare companies on its website.

There was an earlier spate of downsizing at the beginning of this year.  Kaufman Bros. LP, a minority-owned investment bank, ceased operations as of the end of January, according to a notice posted on its website.  The firm had a small equity research team focused mostly on technology.

Ticonderoga Securities, an agency broker which hadshut absorbed research staff from Soleil Securities and Pali Capital, also closed in January.  WJB Capital Group Inc., an agency broker which distributed third party research,  its brokerage operations in the same month.



About Author

Leave A Reply