Analytics to Improve the Research Valuation Process for Asset Managers
Since MiFID II’s research unbundling rules came into force in January 2018, the ‘value’ of research has become a pressing question. The regulatory intention being to eliminate any practice of inducements to utilise execution services by setting explicit fees for the distribution and receipt of research materials.
Rather than passing these fees for research material onto their end clients, many European asset managers have chosen to absorb this cost. However, with the prospect of leaner times on the horizon, budget holders looking to cut costs are eyeing with interest the budget for research – as a significant proportion of an asset manager’s total spend. To defend their research budget, managers must determine the value derived from the research they consume. However, this is fraught with difficulties and many asset managers are looking to technology providers to help ascertain its real value.
GreySpark’s article explores how analytics is allowing asset managers to capture the quality of interactions with research providers more accurately, as well as to dispassionately evaluate the efficacy of the research. This novel approach is allowing them to efficiently cut their research budgets without losing access to the research that matters to their success.
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