Buy recommendations from independent research firms with no investment banking business carry more weight than the same recommendations from investment banks, a new study shows. In fact, the three college professors who conducted the study found that between 1996 and the middle of 2003, the performance of the stock recommendations by independent research firms topped the banks’ recommendations by 8%.

In an analysis by UCLA accounting professor Brett Trueman, University of Michigan assistant accounting professor Reuven Lehavy and Cal-Davis finance professor Brad Barber, however, independent research firms were 4.5% worse than the investment banks in their hold and sell advice. But the three concluded that their most striking results came from the buy side.

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