What set of SEC guidelines guide equity research analysts on what securities they can and cannot cover? When I do a search on sec.gov, all I get is Spitzer-era guidelines on the relationships of bankers and researchers.
Specifically, I am trying to find out more information about laws in place that either prevent or limit an equity research analyst from initiating coverage on penny stocks, microcaps, or small cap stocks. Thank you in advance to anyone who can shed some light on the topic.
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restriction is not on size of the company
Restriction has to do with whether IB side of your firm has/is/will do business with the firm that you cover. There is quiet period when banker are working on deals, and for 15-45days after the deal depending on what your bank did for the company. But, there is no restriction on size of companies you cover. Typically, it's not worth covering too small a company, because there is not enough trades/interest to make it worth your time.