The agency execution business is alive and well, as is the research-as-soft-dollars business model. Lots of trading outfits are still offering stock research as a way to generate business from the buy-side.

We're starting to see more interesting research offerings, such as the one recently announced by ITG. The firm is now the exclusive distributor of Disclosure Insight, by dint of a recent minority investment. According to Traders magazine, the deal allows ITG to offer Disclosure Insight's expertise, which amounts to risk management (risk management news) research embodied in its D.I. Report.

The report summarizes 100 risk factors relevant to a company's stock. The risk factors include undisclosed Securities and Exchange Commission activity; accounting and auditor issues, odd capital markets events and stability of the board and the executive suite. A report covers the last five years of a company's history. Disclosure Insight files about 2,500 Freedom of Information Act requests a year in search of information. The firm says it compresses 50 hours of analysis and due diligence into a one- to two-page summary. Increasingly, it is this sort of value-add that the big institutions are seeking, though you can never discount the value of solid, prescient equity research that makes people money. 

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- here's the article

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