Intermediated research

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In finance, intermediated research is a type of

An alternative form is known as independent research or alternative research, this is research that is not provided by a bank or broker. However, someone has to fund the costs of conducting the research, and when the funder is the company being researched, this form of independent research is termed “sponsored” or “company-paid” research. Unfortunately, with the subject company paying directly for these services, this form of research suffers from a real or perceived lack of objectivity, which reduces its value to investors and hence to the companies themselves.

Intermediated research improves significantly upon the sponsored research model, by introducing important safeguards into the commercial and research process framework. The key structure is that the company has no choice in its allocation to a research provider; once matched with the research provider, the company is under a long term contract in order to minimize commercial pressure or influence; and the fees paid to the research provider are not sufficiently material for the company to be able to exert any influence over the content or conclusions of the research report. Collectively, these measures enhance the value of the report to investors and consequently, to the company itself.

The intermediated research framework includes the further protections; ensuring that the independent research firms involved have no