The buy-side and sell-side are locked in fierce negotiation over how much the buy-side should pay for sell-side investment research. Reports have emerged of some banks demanding $10,000 for a single phone call with their most senior analysts with "enterprise" quotes of as much as $10m a year to provide firms with complete access to their research.
The tense discussions over how much analyst research is worth have intensified since the start of the year as the investment industry readies itself for the introduction of new European rules, known as Mifid II, in 2018. The rules will force fund companies to explain clearly to investors how much of their money is spent on research. Previously research was sent to fund managers for free in return for the business asset managers provided to banks and brokerages when they placed trades. The cost of the research was included in the price of trading.