(image: KobizMedia/ Korea Bizwire)
SEOUL, Aug. 17 (Korea Bizwire) – After many years of failure in attracting market attention, independent equity research firms are finally starting to appeal to investors by releasing a diverse range of market and stock reports.
In the midst of the rise of retail investors, which brought about many changes in the research industry, independent stock research firms have contributed to addressing information asymmetry and expanding the investor base.
Late last month, FS Research went viral after it released a report on local fuel cell manufacturer Kumyang Co., and shares of Kumyang hit the daily upper limit for two straight days.
In general, research centers affiliated with securities firms perform sales activities targeting major institutional investors.
Their company analysis is affected by the relation between the analyzed companies and their affiliated securities firms. Accordingly, their company reports are lopsided towards buy recommendations.
Unlike research centers that have ties to securities firms, independent stock research firms can issue reports on a variety of small-cap stocks and industries without external intervention.
Most employees of such companies have experience serving as private bankers, analysts at major securities firms, or fund managers at asset management firms.
In the meantime, however, some have expressed concern about independent stock research firms since they face minimal regulations compared to their larger competitors.
J. S. Shin (js_shin@koreabizwire.com)
