An analyst in the financial markets researches and reports on the performance of any listed company, industry or economy whose securities trade publicly. Many analysts previously employed by investment banks and brokerages on Wall Street before the credit crisis were "sell-side", whereas institutional investors and fund managers typically employ "buy-side" analysts.
Buy or sell
Financial analysts - also called securities analysts - typically research the performance of certain securities and then issue reports with attached "buy," "sell" or "hold" recommendation to their employers clients.However, "sell-side" analysts are those who write reports aimed at "selling" an investment idea to a client - these reports came under fire earlier this decade when analysts at Merrill Lynch and CSFB published sell-side reports justifying some clearly unsustainable stocks in the IT sector.
"Buy-side" analysts, by contrast, usually work for fund managers or asset managers and can cover more securities and write shorter reports since they have access to sell-side reports as well as their own research. These analysts typically distribute their reports and buy/sell/hold recommendations only to their employers. "Independent" analysts typically work for research firms that have no ties with either the buy or sell side of the financial sector.
- Financial Analyst. Investor Glossary.
- Three Kinds Of Analysts And What You Need To Know About Them. Investopedia - Forbes Digital.