Finding its own way

Tue May 29, 2007


Independent research overcomes the obstacles to become a hedge fund favorite


By Julie Dalla-Costa

When Detwiler, Mitchell & Co. wanted to reinvent itself as an independent research boutique five years ago, the financial heft of hedge funds made them a highly desired clientele. Hedge funds often trade frequently and so have large commissions, giving them soft dollars to disburse. The big players also have plenty of cold hard cash to throw around. Moreover, the industry’s sophisticated analysis dovetails perfectly with Detwiler’s product. “Hedge funds were the most aligned with the type of work that we were doing, as they were looking for unique insight and reach,” says Alex Arnold, the firm’s director of research.

Like a growing number of independent – now more often called alternative – research houses catering to hedge funds, Detwiler doesn’t provide the traditional stock research found on Wall Street. Instead of talking to management, its analysts investigate a company’s...

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