Securities Analysts

Securities analysts' reports and recommendations can influence the price of a company's stock. Over the last several years there has been increased concern regarding the changing role of analysts. Whereas sell-side analysts used to be perceived as objective forecasters of corporate prospects and providers of opinions, some have increasingly become involved in marketing investment banking services. In order to ensure the integrity of our markets, it is vital that possible conflicts of interest among analysts and their firms be clearly disclosed and understood by the investing public who read those reports. The publications listed below address these issues and regulatory matters pertaining to analysts.

Investor Guidance

• Investor Alert: "Analyzing Analyst Recommendations" (modified June 20, 2002).
   
• NASD: Understanding Securities Analyst Recommendations.

Commission Information

• Staff Interpretive Responses Relating to the Global Research Analyst Settlement (November 2, 2004)
   
• Staff Interpretive Responses Relating to the Global Research Analyst Settlement (November 2, 2004)
   
• Division of Market Regulation Responses to Frequently Asked Questions Concerning Regulation Analyst Certification (August 2003)
   
• Order Approving Proposed Rule Changes by the New York Stock Exchange, Inc and by the National Association of Securities Dealers, Inc. Relating to Research Analyst Conflicts of Interest (July 29, 2003).
   
• Notice of Filing of Amendment No. 2 to Proposed Rule Changes by the NYSE Relating to NYSE Rules 344, 345A, 351 and 472 and by the NASD Relating to NASD Rule 2711 (May 22, 2002).
   
• Regulation Analyst Certification (Feb. 20, 2003).
   
• Order Approving Proposed Rule Changes by the NASD and NYSE Relating to Research Analyst Conflicts of Interest (May 10, 2002).
   
• Speech: "Analysts Conflicts of Interest: Taking Steps to Remove Bias," by Lori Richards, Director, Office of Compliance Inspections and Examinations (May 8, 2002).
   
• Press Release: "Commission Approves Rules to Address Analyst Conflicts; SEC Also Requires EDGAR filings by Foreign Issuers" (May 8, 2002).
   
• Press Release: "SEC Launches Inquiry into Research Analyst Conflicts" (April 25, 2002).

NASD/NYSE Information

Self-regulatory organizations, such as the New York Stock Exchange (NYSE) and the National Association of Securities Dealers (NASD), regulate their broker-dealer members' communications with the public, including the opinions provided by analysts for brokerage firms. For additional information about analysts, please view the information listed below.

• NASD Notice to Members 02-39, SEC Approves Rule Governing Research Analysts' Conflicts of Interest (June 26, 2002).
   
• NYSE Information Memo 02-24, Disclosure and Reporting Requirements (May 20, 2002).
   
• NASD: Understanding Securities Analyst Recommendations.
   
• NYSE Rule 472, Communications with the Public.
   
• NASD Rule 2711, Research Analysts and Research Reports.

http://www.sec.gov/divisions/marketreg/securitiesanalysts.htm