New York – Every quarter Integrity Research gets performance data from Investars, which tracks the synthetic returns of research companies. Investars has a full suite of services for portfolio managers, analysts and traders that track research performance, estimate alpha capture, provider broker vote systems and CCA/CSA tracking and reconciliation services.
Overall performance, as defined by the system, is simply the addition of the buy portfolio returns and the sell portfoloio returns assuming that all recommendations were followed. We have adjusted these returns for the 2-Year and 3-Year returns to be at annual rates.
The table below lists the top 15 research providers over the most recent year, sorted by overall performance. In the table the minus sign is bad for the buy portfolio, buy good for the sell portfolio, so that the actual equation for overall return is the buys minus the sells.
|Overall Performance of Research Providers in the Year Ended April 1, 2010|
|B Riley & Co||156.96%||117.38%||-39.57%|
|Charter Equity Research||92.49%||75.41%||-17.08%|
|Lazard Capital Mkts||77.62%||77.62%|
|Standpoint Research, Inc.||75.16%||75.16%|
|Boenning & Scattergood, Inc.||72.94%||64.71%||-8.23%|
|DA Davidson & Co||72.09%||97.37%||25.28%|
|Ladenburg Thalmann & Co. Inc.||64.73%||87.07%||22.34%|
|Global Hunter Securities||58.46%||58.46%|
|Market Profile Theorems (MPT)||57.26%||119.69%||62.43%|
|Dougherty & Co||56.99%||102.65%||45.66%|
|Haugen Custom Financial Systems, Inc||50.50%||125.18%||74.68%|
Source: Investars database
In general, firms at the top of the performance leader board were small fundamental research providers with small coverage lists.
B. Riley & Co. was the top performing research provider on the Investars platform, generating 117% return from its Buy recommendations and a further 39.6% from is sell recommendations. B. Riley & Co. is no stranger to this top position, having been at the top of the performance leader board multiple times over the last several years. B. Riley, a regional investment bank headquartered in Los Angeles, provides fundamental research and trading ideas to institutional clients and high net worth individuals, as well as investment banking services to a wide range of middle-market private and public companies. The firm provides equity and high yield research on companies that are under-followed by Wall Street. A large majority of the 100 plus companies B. Riley covers are small cap California-based firms.
In Second place was Charter Equity Research. Charter Equity is an alternative research provider focusing on the wireless/telecom industry, with sub-sector coverage of services, equipment and semiconductors. The firm provides thematic research as well as analytic coverage on 21 publicly traded wireless providers, five of which are small cap firms. The firm was co-founded by Edward Snyder, formerly a top ranked analyst at JP Morgan, and Julie Fleischer, who previously worked as an investment banker focused on the tech industry. In addition to the founders, the firm has one analyst: John Dryden, who previous worked as an equity research consultant for Citadel Investment Group.
In third place was C. K. Cooper & Company. C. K. Cooper & Company is a boutique investment bank that offers insightful research, sales and trading, wealth management, conferences, Capital formation, mergers and acquisitions, valuation and fairness, and general advisory work to individuals, institutions and corporations. Headquartered in California, the company is a subsidiary of C & K Capital Corporation. The firm’s Research team publishes various weekly research notes and company specific reports within the Oil & Gas Industry focusing on the Exploration and Production sub-sector with 250 companies under coverage. It mainly focuses on under priced companies.
Also if interest, is the emergence of Global Hunter Securities. Global Hunter’s research is run by John Dutton, a long time research provider with the firm Dutton Associates. In the past, John’s research product has performed very well and we welcome him back to the top of the leader board.
Note: The data comes from the Investars research performance measurement system. The presentation and interpretation of the data is that of Integrity Research Associates.