Word on the Street
Scandal-ridden investment houses are leaving gaps in the financial market, and savvy entrepreneurs are jumping at the chance to fill them. How will this trend shape the new face of Wall Street?
Waheed Hassan hardly reminds anyone of Gordon Gekko. A 31-year-old stock analyst with a high, boyish voice, Hassan founded his Potomac Falls, Virginia-based independent stock research firm in May 2003, with two other partners. Hassan's firm, Investology, remains tiny, with only one full-time employee. Unlike analysts at big investment banking firms, Hassan doesn't appear on CNBC in sharp suits, give frequent quotes to The Wall Street Journal or expense fancy lunches. No, Investology toils in relative obscurity, focusing on stocks of companies most Americans have never heard of. "We do research on small capitalization stocks," says Hassan. "Merrill Lynch, Morgan Stanley-they don't cover small caps [today], so it's an opportunity for us."
These days, there are more and more Waheed Hassans, and fewer and fewer Gordon Gekkos. Over the past three years, as IT has made it easier for entrepreneurs to sell stock research, and as scandals involving Wall Street brokerages have sullied the image of the largest firms, the market for independent stock research and analysis has opened up. And savvy entrepreneurs like Hassan are stepping into the breach, taking business from the financial giants. Indeed, despite its hand-to-mouth existence, Investology's independent research has already won the company a relationship with one of the bigger U.S. pension funds.
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