Within the investment landscape there are always conflicts of interest. Interests that can be at odds with each other. For example, within the research sphere, notes are typically produced by the house broker, the company’s Nomad, or are paid for (usually in cash) via so called “independent” research providers.
As industry professionals with decades of experience in the stock markets, headed up by highly qualified individuals from both fund management and analytical backgrounds, we have learnt the hard way just how each vested interest can work against the end investor’s interest.
For instance, where a note is produced by the broker to a company it is almost without exception that a “Sell” rating is never issued. In essence, parties are not going to bite the hand that feeds them. Regulation has tightened up in this area in recent years so that these inherent conflicts are disclosed. However, the universe of “tied” broker notes is generally questioned by fund managers and seasoned investors.
Similarly, traditional “paid for” research providers are remunerated almost exclusively in cash and so the end result with regards to stock price movements, post the production of the research note, is largely of little consequence to these firms. They still get paid.
It is from this background and landscape that ALIGN Research was borne. Our USP’s are thus 3 fold:
- We approach only those companies that we actually BELIEVE in. We don’t take all and sundry onto our books on the basis of preparedness to pay. Belief in the investment case is our sole criteria in selection.
- We actively look to take payment almost exclusively in the company’s equity or apply payment to purchasing the equity of the covered company. This of course ALIGNS us with both the company (existing shareholders and management) and new investors that act upon our research notes. If we are wrong in our analysis we suffer the same fate as the covered company's shareholders.
- We also propose “Conviction Sell” recommendations on certain companies where we feel the shares are a good short opportunity and, where applicable, openly disclose our position in such a candidate.
You can see just how the Align Research offering is a complete breath of fresh air on the investment landscape. Completely transparent, indepth research produced only on those companies that we are prepared to hold and in many cases, actually put our own additional capital into - in contrast to almost every other research house operating today. We view our proposition as a complement to a covered company's existing research offering with our audience focused particularly on "Retail" investors through our open access platform. Finally, we are also completely aligned with those investors acting upon our recommendations.