Investment banking v. Investment research

If you order your research paper from our custom writing service you will receive a perfectly written assignment on Investment banking v. Investment research. What we need from you is to provide us with your detailed paper instructions for our experienced writers to follow all of your specific writing requirements. Specify your order details, state the exact number of pages required and our custom writing professionals will deliver the best quality Investment banking v. Investment research paper right on time.

Our staff of freelance writers includes over 120 experts proficient in Investment banking v. Investment research, therefore you can rest assured that your assignment will be handled by only top rated specialists. Order your Investment banking v. Investment research paper at affordable prices!

Economic Policy Debate

Investment Banking is basically the practice of a financial firm issuing and underwriting stock for a separate company who pays a fee for the company to do so.

Investment banks, and firms serve a range of activities, along with selling, and, trading stocks, and bonds they provide financial advice. These services are being provided to companies, governments, non-profit institutions, and individuals. The research teams of an investment bank provide the link to the institutions that own the clients stock. Part of an investment banks duty is to provide knowledge and advice to corporations. If the research branch of an investment bank were separated then many primary functions would not be possible.

Separation of investment banking and investment research is a theory that supposedly lets analysts express their true views on stocks without fear of cramping the style of investment bankers. Complete separation is such an extreme answer to a problem that it is not plausible and would likely create more problems then it would fix.

Order Custom Essay on Investment banking v. Investment research

Researchers and investment bankers have been tied together for over 50 years and even though maybe consumers should not get their investment information from such a biased source, this favoritism towards companies that they are doing business with has been an expected part of the business. Companies and consumers are both accustomed to the analysts producing reports that are basically paid advertising. Most investors are aware of this. The recent extreme reaction to this problem is only because of the recent drop in the stock market. Something should be done to make investors fully aware of the difference between a biased source and more biased source, but you will never fully get rid of bias or bias reports

A bank has to hire analysts. Maybe the government can restrict publication of the their reports but it can't restrict a company from hiring analysts. Analysts produce helpful and informational reports to companies and consumers free of charge. If separation were to occur companies and consumers and banks would all have to buy costly reports. This would basically drive up the entire cost of investing.

This is taking an extreme measure for a practice that is not frequent or overly abused. The research reports should be required by law to be clearly distinguished as produced by the Investment Bank that the company is doing business with, much in the same way long advertisements in magazines have ADVERTISMENT written on the top and bottom of the page to make clear to the magazine reader that this is not an article whose opinions represent those of the editor

It would not only put many good analysts out of a job but, also call for a whole new field of researchers that without being affiliated with Investment banks and firms would have to charge a lot more money then usual analysts. Jon Eagleton (who is president of Investars, which is a research firm that tracks analyst performance) said, "At the end of the day it would actually be the individual investors who would suffer from the separation the most." That is interesting considering the whole theory of separating research from banking would be to protect and help the investors.

As Association for Investment Management & Research president Thomas Bowman points out, it wouldnt do anything to eliminate other conflicts of interest that analysts fall prey to, such as pressure from the companies they cover to maintain a positive outlook and pressure from money-management clients who read their research not to downgrade the stocks they own. These are pressures that have not been addressed,

Unfortunately it is true that there are dishonest analysts working to increase the business of investment banking. As in every field there are also thousands of hard-working honest Americans giving the best reports they can for their clients. Passing this law would punish all of the good firms along with the few bad ones.

Instead of complete separation between banking and investing the best solution would be a series of reforms to improve the industry. New rules would require analysts to be paid solely on performance. This isnt easy to do, but new independent research firms, such as Investars and Starmine, are already springing up that track analyst performance and can be used to reward the ones that have the most accurate earnings forecasts and make clients the most money. This will discourage false reports given from dishonest analysts. Firms are also ridding themselves of bad analysts; the Association for Investment Management & Research has recently announced that they are investigating over 100 cases involving researchers and their fixed and faulty reports. These analysts will be stripped of their Chartered Financial Analyst (CFA) credential, which will permanently remove them from the industry.

In conclusion, passing this law would not only change the stock and trade market, but could dangerously hurt our economy, as the stock market is already dangerously low.

Please note that this sample paper on Investment banking v. Investment research is for your review only. In order to eliminate any of the plagiarism issues, it is highly recommended that you do not use it for you own writing purposes. In case you experience difficulties with writing a well structured and accurately composed paper on Investment banking v. Investment research, we are here to assist you. Your persuasive essay on Investment banking v. Investment research will be written from scratch, so you do not have to worry about its originality.

Order your authentic assignment and you will be amazed at how easy it is to complete a quality custom paper within the shortest time possible!