The new MiFID II regulation became a reality in the EU on 3 January 2018, requiring investment banks and brokers to charge investor clients separately for trading execution and research. This change challenges established business models for investment research and makes it even more uneconomical to have equity research coverage of smaller listed companies. Analyst coverage in Europe is already declining, and if this continues, it could lead to less investor interest in small- and mid-caps.
Watch our Nordea On Your Mind webinar from Corporate & Investment Banking in which we take a look at the repercussions, including:
- Difficulties for such companies to raise capital
- Potential valuation anomalies
- Possible opportunities for private equity to exploit value potential in under-covered companies, and
- What listed companies could do to generate interest in their share
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