Buy side is a term used to describe firms that buys securities and other services from sell side firms.
Buy side firms are essentially the institutional clients of sell side firms. They can be mutual funds, pension funds, hedge funds, publicly traded companies and more. While like their sell side brethren they may employ analysts, their research is never made public.
Importance to Investors
The Buy side firms represent big money on wall street. They are the drivers of short term price movements and can create inefficiency in the market place. They will frequently buy or sell based off new reports from sell side firms or from quarterly earnings from companies that miss,meet or exceed their expectations as outlined by sell side analysts. Accordingly it's important for investors to know how these companies operate as their behavior can help shape the performance of an investor's stocks.
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