Mutual funds and other institutional money managers are using seven percent less independent research than last year, Greenwich Associates found. Providers of independent research reported that institutional managers are paying 11% of commissions this year, down from 18% in 2008.

Of course, following the 2003 settlement with then Attorney General Eliot Spitzer over the conflicts of interest of investment banks providing research on the stocks they underwrote, the brokerage firms agreed to spend hundreds of millions of dollars on independent research for the next five years, and that ended last year.

But strains on profits due to the market’s downturn is making it difficult for institutional managers to pay for independent research—at a time when they could use it most.

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