Research Aggregator Substantive Research Develops Methodology For Ranking Research

Substantive Research, a curator of daily macroeconomic research, has launched a new service, ResearchMatch, intended to help the buy-side compare the quality of their existing external research against the wider market.

Identifying key factors for evaluating written research

The new service filters written research to identify a provider’s core strengths which are deemed valuable to buy side readers.  London-based Substantive Research collaborated with researchers at the University of Edinburgh to isolate relevant factors for evaluating research, such as originality or clarity.  The next step was to conduct structured and semi-structured interviews with buy-side professionals at hedge funds, long only managers and wealth managers to determine which factors were most important.

Source: Substantive Research

A paper authored by Alexander Haig, a fellow at the University of Edinburgh and Substantive Research founder Mike Carrodus, “Unbundling Uncovered: What is investment research worth? A qualitative factor analysis” identifies clarity/readability and logic & rationale as the most important factors from fifty interviews conducted with the buy-side.  High conviction, original research that is backed by quantitative evidence was also ranked highly, according to the paper.  In total, ResearchMatch utilizes 10 factors to score research.

Ranking research

The next step was to develop procedures for assessing how well research meets the various factors.  Some factors, such as ‘investible size’ or ‘investible access’, are quantifiable.  For other factors Substantive Research uses analysts to assess factors using baselines developed from buy-side input.  The firm is developing approaches for parsing research based using natural language processing.

Source: Substantive Research [sample data]

The end result is ranking research product based on how well it meets the various factors.  The application allows buy-side users to identify highly rated research on topics of interest, such as US election results or European interest rates.

Because Substantive Research ingests research from both brokerage firms and independents, one goal for ResearchMatch is to uncover research providers which buy-side readers might otherwise miss, similar to daily curation that the firm currently offers gratis.  The firm is enhancing the platform to allow users to personalize the criteria, such as high conviction and actionable trade ideas under a China theme.

Rolling out the platform

In an interview, Mike Carrodus said that the platform has been adopted by eight buy-side early adopters, with the goal of attaining fifteen.  Since mentioning the new platform last week at a conference Substantive Research organized on research unbundling, the firm has approached by five additional firms expressing interest.

Early adopters commit to a two-year relationship and provide ongoing input on the new platform.  After completing the ‘beta’ process, the plan is to formally launch the product to a broader universe of buy-side clients later next year.

The methodology has been developed to apply to other investment research beyond macro, and the firm is beginning to adopt its model to rank ‘single name’ research.  Substantive Research currently provides feedback to research providers which work directly with it.  As the platform evolves, the firm may license the service to sell-side research firms wishing to improve their product offerings.


Founded in April 2015, Substantive Research’s free daily email which summarizes the five best macro reports published overnight is read by over 1000 buy-side professionals.  Substantive reviews reports from over 40 investment banks and 75 independent research providers, summarizing those it believes are highest quality. The emails drive traffic back to the research providers authoring the reports.

Substantive Research was co-founded by former Ned Davis Research salesperson Mike Carrodus and Hamish Risk, who was previously a content manager for Deutsche Bank’s macro research and an editor at Euromoney.

Our Take

Substantive Research’s methodology differentiates it from the fifteen or so research distribution platforms vying for buy-side attention.  So much so that the firm is comfortable partnering with aggregators such as RSRCHXchange.  In July, Substantive Research announced it was featuring RSRCHXchange for accessing some of the reports cited in its daily curated emails.

The challenge for any platform is gaining critical mass, and Substantive Research has prioritized on building buy-side readership, unlike most research aggregators which initially focused on the easier task of adding research product.

Even though written research is a lower value research product relative to analyst access or events, it has an important role as ‘marketing chum’, as some on the sell-side have expressed it.  Consequently, the buy-side uses written research to troll through current sell-side thought to find potential trade ideas.  To the extent that Substantive Research can improve that process, it has a bright future.