Zak Mir speaks with Dexter Burt, the man behind Ciphersense Research talking about reliable and objective research is out of reach for private investors, with sell-side equity research firms focused on serving large financial institutions and constrained in opinion.
Our proposition is to commoditise equity research to serve those who need it most, everyday investors.
Ciphersense was founded in an era of ever loosening monetary policy, emerging asset bubbles and rising inequality fuelling discontent with the corporate system. We are represented by a diverse collection of disenchanted individuals with a professional background in accounting, a cynical disposition and desire to restore morality in financial markets.
Our proposition is founded on the fact that equity research does not serve private investors. Riddled with conflicts of interest and a dysfunctional incentive system, most research is paid for by companies wishing to promote their stock. Reliable and objective research is out of reach for private investors, with sell side equity research failing to fulfil its purpose.
This issue is pervasive across the micro and small cap space, where we intend to focus our efforts. Our proposition is to commoditise equity research to serve those who need it most, everyday investors. Our business model is centred on depth and quality, consequently we intend to only initiate coverage on 3 – 5 fresh ideas a year. This self-imposed limitation enables us to present our thesis’ with conviction, supported by our investigative, due-diligence techniques to unearth market anomalies. Once under coverage, timely updates will be issued post the release of the interim and annual results.
As a research only organisation, we are rewarded for the quality of our research and do not take positions in the stocks we cover to maintain our objectivity. We are motivated provide private investors with compelling research that is often contrarian to the market consensus. Coverage may be discontinued over the course of time, as our thesis becomes reality. Our objective position affords us with an opportunity to deliver unconstrained and truly thought-provoking research currently lacking in the marketplace. Our investigative and due diligence-based approach means we hold a bias towards short opportunities.
We investigate businesses employing aggressive accounting, questionable corporate governance, and implausible business models. Our coverage offers a unique perspective on Micro to Small Cap stocks, exploring and exposing situations traditional short-sellers and traditional research firms shy away from due to lack of borrow availability. Our purpose is to provide retail investors an informational advantage.
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