The de-coupling of research funds and commissions

Research and unbundling

MiFID II will further break the links between execution and payment for research by decoupling the relationship between trading activity and the amount of funds available to pay for research.

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Research becomes a line item

Research budgets will need to be set in advance and funding of this budget must not be linked to the volume of transactions executed. Regulators are expecting fund managers to budget and pay for research in much the same manner as they would budget for any other essential service to their business. Banks and brokers will be expected to explicitly charge for execution and research separately.

Pricing and protecting your research

The implications are that as banks and brokers will be expected to explicitly charge for research separately, they will need to understand how to value and price their services.

Change teams will need to address these fundamental amends around how firms produce their research content, assess its quality, manage its distribution and secure their valuable assets.

An increasingly important consideration is protecting the intellectual assets invested in the research. With research increasingly a permissioned and priced asset provided to specific clients, it’s important to be able to manage the distribution, access and potentially control subsequent onward distribution. 

A wealth of resources at your fingertips

We provide a number of tools and technologies to help secure those research assets. In addition to granular entitlements management, together with detailed usage/consumption tracking and reporting, these include dynamic watermarking of research documents and link back authentication of click-thru access to the firm’s own infrastructure.

Eikon already provides direct access to research from over 800 active brokerage firms, independent research firms and other sources, covering 21,000 companies across 87 countries.

StarMine ratings provide additional insights into analyst accuracy and recommendations providing fund managers with a powerful tool to help select the most accurate and cost-effective research to succeed in the post-MiFID II environment.

Intelligent Tagging can process internal research and co-mingle valuable in-house insights with external material and multiple additional sources of unstructured data to bring together the best possible aggregated information on which to make decisions.

Research Management Console controls access and permissions through usage reporting, providing transparency into what is actually being viewed what customers find most valuable. All of which can help build more accurate research pricing models and billing schemes.

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