buy side

Buy Side

The side of Wall Street comprising the investing institutions such as mutual funds, pension funds and insurance firms that tend to buy large portions of securities for money-management purposes. The buy side is the opposite of the sell-side entities, which provide recommendations for upgrades, downgrades, target prices and opinions to the public market. Together, the buy side and sell side make up both sides of Wall Street.

Notes:

For example, a buy-side analyst typically works in a non-brokerage firm (i.e. mutual fund or pension fund) and provides research and recommendations exclusively for the benefit of the company's own money managers (as opposed to individual investors). Unlike sell-side recommendations - which are meant for the public - buy-side recommendations are not available to anyone outside the firm. In fact, if the buy-side analyst stumbles upon a formula, vision or approach that works, it is kept secret.

See also: Institutional Investor, Money Manager, Mutual Fund, Pension Plan, Security, Sell-side, Wall Street

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buy side

The portion of the securities business in which institutional orders originate. In most instances, the buy side is limited to institutional buyers such as pension-fund portfolio managers. Individual investors are usually excluded from the buy side because they are not considered formal participants in the securities business. Compare sell side.