Top 10 Takeaways

1. Investors have signed the first contracts for research and meetings with broking banks, but negotiations are still ongoing.

2. The participating investors gave us first price indications for an annual contract providing local German equity research and meetings of between €10,000 and €30,000.

3. 1×1 management meetings investors take on conferences or in their office are priced between €50 and €300.

4. Investors so far have only accepted very few meetings and little company research outside their contractual relationships with banks and brokers.

5. The first well known and established broker conferences in Frankfurt and London showed significantly lower attendance from the investors.

6. Some investors take travel costs to visit a company at its head-quarters as a ceiling for pricing convenient management meetings at the investor’s office.

7. Contrary to the companies themselves investors believe in a significantly lower research coverage, especially for small and micro-caps.

8. Investors also believe that the number of management meetings banks provide will fall significantly.

9. They therefore urge companies to use third party service providers to organise management meetings. Otherwise, valuable investor contacts, especially investors in smaller financial centres, and specialised small cap investors will be left out.

10. Investors attribute a low quality to issuer paid research. They will still use it as a first read into an unknown company. They believe that the quality of paid research will rise as a consequence of MIFID 2.