Technical question about buy-side/sell-side
Please correct me if I’m wrong at any stage and forgive me for my ignorance! Also I'm not sure whether I've posted this in the correct section.
From my (basic) understanding, IBs are on the sell-side and money managers (asset managers, pension and mutual funds, hedge funds, private equity/venture capital firms?) are on the buy-side.
What other types of firms are on the sell side?
Now the main part of my confusion is the fact that people say how awesome it is to work on the buy-side and they want out of the sell-side/IBs...
Why can an IB not be on the buy-side? I understand that when a firm wants to sell it hires a sell-side advisor (an IB) but I also know that when a money manager wants to buy then it may hire a buy-side advisor. Now I’m assuming that this advisor is also an IB – but doesn’t that make the IB buy-side then?!
Thanks fellas
I'll put this very simply:
Sell side: You sell stuff (research, advice, securities, etc.). Investment banks are in the advisory business. If they are a full service investment bank, other services of the sell side may include research, sales and trading, and capital markets. The bank is referred to as a buy-side advisor when they are advising a company looking to acquire another company.
Buy side: You buy stuff (securities). Think mutual funds, hedge funds, PE, pension funds..basically everything you listed.
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