The new MiFID II regulation became a reality in the EU on 3 January 2018, requiring equities businesses to unbundle their service into charging investors separately for trading execution and research. This change challenges established business models for investment research and will likely lead to less coverage of small- and mid-cap companies.
Less coverage reduces investor interest and subsequently trading and liquidity, increasing volatility, making it difficult to use equity-based executive incentive plans and attract long-term shareholders. For companies that lack sufficient coverage, a commissioned research service from a bank or broker is a tool that could help alleviate the risk of falling off investors’ radar screens entirely.
Also out today: Our Market Research team takes a look at how the liquidity tide is ebbing after years of central bank asset purchases and monetary expansion. Read “Central bank liquidity: Into the desert”
Don’t miss our webinar, recorded on 30 May, in which Nordea Markets’ Johan Trocmé, Ellen Benktander and Hemming Svensson dive into the latest NOYM theme, “Liquidity drought”, and what listed companies can do to generate interest in their share. Watch the webinar
Latest Thematic research:
18 Apr 2018: Nordea On Your Mind – The end of cheap labour
19 Mar 2018: Nordea On Your Mind – Cybersecurity
20 Feb 2018: Nordea On Your Mind – Diversity boosts stability of returns
Johan Trocmé | Director, Thematic Research | +46 101 56 34 22 | Analyst info
Ellen Benktander | Analyst, Thematic Research | +46 101 57 28 87 | Analyst info
Hemming Svensson | Analyst | +46 101 570 966 | Analyst info
Nordea Markets is the name of the Markets departments of Nordea Bank AB (publ) and its branches Nordea Danmark, filial af Nordea Bank AB (publ), Sverige, Nordea Bank AB (publ), filial i Finland and Nordea Bank AB (publ), filial i Norge. The information provided herein is intended for the sole use of the intended recipient. The views and other information provided herein are the current views of Nordea Markets as of the date of this document and are subject to change without notice. The views have been provided solely based on the information made available to Nordea Markets and for the purposes of presenting the services made available by Nordea Markets. This notice does not substitute the judgement of the recipient. Nordea Markets is not and does not purport to be an adviser as to legal, taxation, accounting or regulatory matters in any jurisdiction. Relevant professional advice should always be obtained before making any investment or credit decision. This document may not be reproduced, distributed or published for any purpose without the prior written consent from Nordea Markets. This transmission is intended solely for the person or entity to whom it is addressed. It may contain privileged and confidential information. If you are not the intended recipient, please be notified that any dissemination, distribution or copying is strictly prohibited. If you have received this transmission by mistake, please let us know and then delete it from your system.