UBS Taps Whitman Prof to Evaluate Research


Professor Fernando Diz has been retained by the Independent Research office of UBS to evaluate third-party research the investment firm will provide to clients under the 2003 global research settlement with Wall Street firms.

Diz, the Martin J. Whitman associate professor and director of the school’s Ballentine Investment Institute, will use a research-ranking algorithm he originated to produce his rankings. His analysis will help UBS select investment researchers. To prevent any possible bias, Diz will not know the identity of the firms he is evaluating.

The Whitman School has created the Equity Analysis Center, with Diz as its head, to handle the work.

Diz’s contract with the Independent Research office is for five years. The office was created as part of the October 2003 agreement between regulators and 10 Wall Street firms that settled conflict of interest charges over biased equity research. Under the terms of the settlement, each firm is required to retain an independent consultant to oversee distribution of independent investment research to clients for a period of five years.

The independent research will be supplied to clients along with the firm’s own recommendations. Clients will begin receiving the third-party research in July.

“This is a ‘second-opinion’ system in which investors will be able to get another set of recommendations in addition to those from their broker’s company,” Diz says.

Diz received his Ph.D from Cornell University in 1989. He specializes in trading, derivative securities and the use of managed derivatives in investment portfolios as well as value and distress investing. His work has been presented at academic as well as industry forums such as the American Stock Exchange (AMEX) Derivatives Colloquium, and the Forum for Managed Futures and Derivatives. He has consulted with several utilities and power companies on issues related to trading electricity, the Spanish futures exchange (MEFF), and the Caixa de Catalunya.  Diz is a member of the index committee of one of the first investable managed futures indices.

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Written by Cyndi Moritz, SU News Services
Thursday, May 13, 2004
315-443-9039
cjmoritz@syr.edu