Covid-19 effect on ER: Who wins and who loses?
So, we're more than 2 months into this pandemic. Anyone have any insight into how this is going to change the equity research industry?
Will panicked investors return to active management, lifting all boats? Will BBs take more share and walk away winners? Will declining AUMs devastate the entire industry?
Has anyones' department already announced hiring freezes, layoffs, or bonus reductions? If so, what type of firm are you at (MM/EB/B/BB)?
I'm an incoming associate, and I'm just trying to gauge how much of shit show I'm entering.
Interesting questions, would love to know also. It's a shame that the ER part of the forum is so dead
Is there any forum where there are active ER conversations?
VIC - More buyside than sellside, but great forum for market discussions, pitches, etc.
VIC? What's it called exactly, having trouble finding it
It’s called Value Investors Club
Thanks!
I honestly think this is TBD. More dynamic environments like this give the sell side a lot of ammo to add value and help the buyside digest what’s happening. However, I don’t think this will necessarily stop the shrinking wallet and other headwinds. If economic damage/markets end up a lot worse and causes more hedge funds to shut down or people to pull funds from shops, it would be bad also obviously.
My firm has not had COVID related layoffs in ER. I don’t expect the bonus environment (already not great) to change much as a result at this point, but who knows
I think BBs and select boutiques retain share as the pie shrinks, but everyone hurts. Certain boutiques who haven't grown into the pain will be alright, but those who have been spending big will suffer. I'm currently at a very established boutique and there have been both layoffs and comp cuts recently.
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