UK - AQ Research, a London-based independent provider of analysis of the quality of stockbrokers' research in Europe, is to launch a web-based investment research exchange in April.
The AQ Research Exchange (AQREX) is intended to provide a market-based solution for enhancing current research procurement models on small and mid-caps between fund management groups and brokers, said AQ commercial director William Russell-Smith. It could be extended to large caps at a later date.
AQREX seeks to address the concerns of three constituents: smaller companies that complain of insufficient research coverage; brokers dissatisfied with a lack of revenues on the small caps they cover and poor trading liquidity; and fund managers who view available research as being of generally of low quality and not fully meeting requirements, he added.
Users of AQREX will be able to view prices of separate transactions for up to eight different categories of research before negotiation. These include generation of six or 12 top investment ideas from a region, market or sector; analyst/team access; commission bespoke projects; one-on-one meetings with company management; invitations to specialist broker-sponsored thematic conferences for investors; and access to and use of investment analytical tools.
"We want to think of the research as being not being just confined to the traditional written note, but also the broader range of activities that an analyst performs," Russell-Smith said.
The initiative comes against the backdrop of unbundling in the UK and Europe - effectively a disclosure of the split between execution and research payments and commissions.