Asset Management

Activist funds benefit from Mifid II research cuts

It is easier for activists to buy stakes in small and medium-sized companies more cheaply

L-R: Franck Falezan of Primestone, Liad Meidar of Gatemore Capital, and Greg Mulley of Herbert Smith Freehills, address the FN event
L-R: Franck Falezan of Primestone, Liad Meidar of Gatemore Capital, and Greg Mulley of Herbert Smith Freehills, address the FN event Photo: Stewart Williams

Dramatic cuts in spending on investment research by asset managers in Europe has been a boon to activist hedge funds, according to a panel of leading activists and advisers speaking at a Financial News briefing on Wednesday.

The world’s largest asset managers have cut their spending on research on companies since the EU introduced new market rules in 2018, which forced asset managers to separate trading and research expenses for the first time.

WSJ Logo