How should I interpret this industry research?
As BobbyScon said in the comments, invest in a company that is developing in that field. Or invest in a company which supplies that field. The people who got rich in the California gold rush were those selling shovels and other miners' supplies. Or bet against whatever you think this will displace. If automobiles are the hot new thing, it might be a bad time to invest in harness leather. Or ... figure out how else it might impact the economy and invest appropriately. But you have to do that evaluation yourself. Or ignore it and stick with your existing strategy, which should have been diversified enough to deliver reasonable results whether this sector takes off or not. Remember that if someone gives you a free tip, they are probably just hoping to pump up the value of their own stock rather than help you.
No. The information you are describing is technical data about a stock's market price and trading volume, only. There is nothing implied in that data about a company's financial fundamentals (earnings/profitability, outstanding shares, market capitalization, dividends, balance sheet assets and liabilities, etc.) All you can infer is positive or negative momentum in the trading of the stock. If you want to understand if a company is performing well, then you need fundamental data about the company such as you would get from a company's annual and quarterly reports. I've tried to argue this to some close friends who bought homes, pre/post-crisis, if the crisis ever ended, they thought it was ridiculous. There is a clear fulcrum where renting makes more sense than buying, when appropriate inputs of data are entered into the model. I think Khan Academy did a good 10-minute run down on the subject and used a relatively good model, as well.   Further than that, I read the first few paragraphs and stopped reading, it was a commercial. I was shocked. The entire thing up till' 2 paragraphs in is literally a commercial.   The supposed 'antagonist', explicitly implied by the title isn't actually an antagonist, it's a click-bait commercial -article posing as a real article, (imitation), that actually might have some real science below the commercial, as you've indicated, but that part also sounds like junk finance; to sell the idea to consumers that they should in fact buy homes (instead of rent), and get loans from banks (preferably this one), and do anything to achieve that, if need be, even move in with their parents.   This financial institution appears to have a sophisticated public relations marketing team doing their commercials-posing-as-news campaign(s).   Very interesting to see the marketing beast morph itself into something so sophisticated, as to contain such clear imitation, junk science, and click-bait. I wonder what kind of penetration they are getting with this model, and what percentage of those see it for what it is.   I suppose that would be a big-data question, answerable through analytics. "Hey there - thanks for your input. The internet can be a confusing place sometimes, especially when you don't know what to look for. I've subscribed to usenet (for the ""white papers"") but so far to no avail. I'll definitely search for the Moody's paper!" Did you read your own link?  It lists a lot of conflicting studies and concludes that there is no consensus as a result of those.  Even if you were to cherry pick and select the worst case study, the difference is still less than  5 points, which is too small to be really meaningful. "**The paper’s findings are preliminary and have not yet been subjected to peer review.**  &gt;""The paper’s findings are preliminary and have not yet been subjected to peer review. And the authors stressed that even if their results hold up, their research leaves important questions unanswered, particularly about how the minimum wage has affected individual workers and businesses. The paper does not, for example, address whether displaced workers might have found jobs in other cities or with companies such as Uber that are not included in their data.""" Other metrics like Price/Book Value or Price/Sales can be used to determine if a company has above average valuations and would be classified as growth or below average valuations and be classified as value. Fama and French's 3 Factor model would be one example that was studied a great deal using an inverse of Price/Book I believe. I think many of you are making unrelated comments and taking unjustified conclusions from the news, without reading the research. Many of the mentioned share provisions are not exclusive to Silicon Valley, technology firms, or the rest of Private Equity (i.e. ex-VC).  The paper says:  &gt;These generous terms are not necessarily evidence of active post-money valuation manipulation and could simply be due to a difficult fund raising environment.  And:  &gt;Importantly, our discussion does not imply that these terms were given for the purpose of manipulating SpaceX’s value.  That is not to say that I am not skeptical of many of the business models and valuations of the companies in the sample, but that is off the research topic.   What the authors suggests is that valuation is often miscalculated by many people in the industry, and provides some relevant cases: from mutual funds who market those shares at the value of the most recent funding round, regardless of share provisions; to employees that wrongly perceive their wealth.  I have some trouble accepting Brownian Motion to model exit prices (or pretty much anything else), it seems a bit off from reality, but nevertheless I think the paper is worth the read. "What you're thinking of is more market making kind of activity, HFT algo's thrive on this; having information faster than anyone else. This type of activity could also likely be lumped into what is considered top-down analysis as opposed to bottom-up (which is what most mutual fund equity research involves). Again, the more important aspect is, what does the company you are applying to use!  Top-down analysis means that you are forecasting the revenue drivers for a company using macro-economic analysis. For example, let's say I'm investing in Chinese cement manufacturer's, what implications does Chinese interest rate policy have on infra-structure expansion and how does that drive revenue for this specific company. I might then look at margins, etc. to get an EPS estimate. Part of this could fall into secular  investing, too. Let's say I like LCD panel glass because of this consortium, I might take a look at 5 companies and then find the ones I think would benefit most from this. The problem with top-down is it tends not to be as much of a deep-dive, and its hard to pick individual companies because of it. Bottom-up tends to be more analytical and is what most pitches would be based around. The most important thing I'm not saying one is right or wrong, they are just different, and every investor has their own style.  Bottom-up analysis, which would be closer to what an equity research analyst would be doing on the sell-side, is analyzing what bottom-line indicators drive revenue and how are those expanding. For example, lets say I'm looking at search providers (i.e. Baidu, Google, Yahoo, etc.) I'd be looking at Cost-Per-Thousand-Clicks (CPTC) and number of clicks on the website. Multiply the two and I get revenue (very simplified version) for clicks business. I might then also forecast other revenue driving segments and try to understand how they are growing/pricing at an individual segment level (i.e. business services or mobile advertising). I'd then break down costs/margins for each segment and forecast those out. I could then get a forward EPS, get a range of multiples I believe it could trade in (i.e. I think the multiple will trade up/down), to get a target price. Also, I would likely do a DCF analysis on forward earnings to get a ""fair market value,"" and then try to triangulate a price. I would also be looking at stuff like management teams and industry trends, too, but bottom line, I'm pitching a company because I think it is undervalued and will outperform competitors **in the long run**. This type of work tends to be more research oriented and is what most (not all) mutual funds use when analyzing companies. Since mutual funds tend to have longer holding periods (2-10 years), as opposed to short-term, it's harder to justify investing in a company only because it has a short-term catalyst. Anecdotally, it's also easier to present in a written thesis because the numbers tend to be more concrete and easier to forecast than top-down (which have wider target ranges).  Your thought process that catalyst + industry context = market beating returns isn't wrong, it's just that every company thinks about investing differently, and it's important to tailor the report to that group's style." TL;DR for those who don't want to waste their time: Uber didn't do anything special. Also, you should follow unethical laws and not try to change or challenge the system.  While I was reading the piece I thought it was the work of a sophomore, but it turns out this was written by a professor. Yes, it's true (from a BB perspective).  This isn't the 80's where M&amp;A's are the money makers.  This isn't the 90's where IPO's are the cash cows.  Going forward the new products, especially the OTC derivatives market and FI are going to be where a lot of resources are pooled and where revenues are generated.  Ask yourself the question, why do you want to go into equity research as opposed to another product? Despite a fair number of views, no one besides @mbhunter answered, so I'll gather the findings of my own research here. Hopefully, this will help others in similar situations. If you spot any errors, please let me know! My company has a dashboard that basically does this. We select industries / companies we want to be notified of and we get an email in outlook when a new analyst note, research report, or SEC filing is posted on that industry or company. "One of the things I have enjoyed about consulting is the exposure to multiple companies and multiple business units within those companies. In the year I have been at The Gunter Group, I have already worked with multiple clients on projects that span across the respective organizations. It has been very interesting to contrast the clients and more specifically the corporate cultures that exist within those companies.  I have participated in and watched various projects being driven in different parts of a client's business and it is interesting to see which projects have been, are, and will be successful. The other day I was reading a report of some analysis done by one of the world's largest and most respected consulting firms. The analysis was essentially outlining a path for success for a broad spectrum of projects of varied scopes and complexities. The analysis, which was very good by the way, touched on a lot of elements of the business that would impact the likelihood of project success. Elements like governance, data analysis, process design, etc. The analysis and the accompanying recommendations were undoubtedly sound given the caliber of the firm, the background research done to support the report, and my own confirmation based on what I have picked up about the client. I try and get my hands on these types of reports whenever possible to see how ""the big boys"" are doing it, to shape my own thinking, and to have examples of successful presentations. I am, however, always surprised that these reports fail to mention what I consider to be a very big influence on the success of a project and ultimately the success of the organization as a whole.  At their core, companies are merely people. A group of people with a collective identity; a corporate culture if you will. Reflecting back on my many interactions with the people that make up these organizations it has become very evident to me that a collaborative corporate culture is a huge discriminator in determining the success of any project. Although it is a macro factor, the collaborative spirit of an organization transcends everything that the company does and/or attempts to do.  Here is an example to give context of the premise I am talking about.  At client A, the project team I worked with was designing an extremely innovative, complex, and challenging system that has the potential to alter the way they do business. Without going into too much detail, it was a massive undertaking with relatively limited resourcing.  At client B, the scope of work I was involved in was relatively straightforward and mirrored business practices at other organizations. The bulk of the effort on my part was driving the creation and adoption of a framework to promote cross functional interaction amongst project teams. A very realistic undertaking with appropriate resourcing.  Below are vignettes that illustrate typical exchanges in both organizations. In both organizations I have been directed to connect with a particular individual or group of individuals as it was thought that our respective works may be related in some fashion.  Client A: Me - ""Let me give you a brief overview of the project I am working on. John Doe recommended I connect with you as your project may intersect with mine in some manner. We may be able to help each other."" (Continue with my overview)  Other Party - ""Wow, this is great. I actually have really in depth knowledge of X and would love to get involved in the work you are doing. I am actually simultaneously driving Y effort and it would be great if we were aligned. At a high level we are both supporting strategy A so connecting now would really set us up for success. Feel free to include me on your future meetings and I will pass along our high level overview. Also, have you thought about connecting with So and So? They are working in the Z space on a project and it may help to drive your project forward as well.""  Client B: Me - ""Let me give you a brief overview of the project I am working on. John Doe recommended I connect with you as your project may intersect.......""   Other Party - (Interrupts) ""Well we have already gotten our project approved at such and such level and we have found that we really don't have any interdependencies with your project.""  Me - ""Oh, OK. Well I am not really looking to create additional work for anyone. I am just looking to leverage the work we are both already doing. We may be able to help each other.""   Other Party - (Interrupts again) ""Our project team is really busy and we are on a tight deadline. We don't have the resources we need. I have told John Doe time and again we need more help but until we get it I just really need to focus on X.""  Me - ""OK. Well how about I jump in to what it is we are actually doing and if there aren't any opportunities for collaboration or any synergies to be gained from working together that is fine. I just wanted to be proactive about connecting the dots across the organization. (Continue with my overview)  Other Party - ""...........*crickets*..........."" (Meeting concludes.....)  These aren't depictions of a single event. They are aggregations of month's of interactions that give a good representation of single events in a variety of contexts on a daily basis. Of course, there are exceptions. However, I have found that exceptions within both cultures are extremely rare based on my personal experience. This only furthers my point. Can you begin to see why a collaborative corporate culture is so foundational to the success of any endeavor regardless of scope, complexity, etc?  The other aspect that adds to the importance of a sound corporate culture is the self fulfilling nature of culture. Which organization do you think inspires future collaborative behavior? Even those people that want to collaborate within client B are consistently met with resistance. Those in client A are inspired by the positive interactions, enhanced results, and they are more likely to actively seek out others to help and work with. Both trajectories are accelerated in opposite directions just by the nature of the prevailing culture.  So how do you create and engender a culture that embodies collaboration? That my friends is a question I don't pretend to have all the answers too. Maybe I'll be so lucky to figure that one out someday......" Technical analysis is insufficient. You're halfway to figuring it out if you start to question why a 50 day moving average vs 200 vs 173. Invest in companies that are attractively valued vs. their sales/growth/divends/anythingelsereal "all the other answers are spot on, but look at it this way. really all you mean when you say ""building equity"" is ""accumulating wealth"".  if that is the goal, then having her invest the money in a brokerage (e.g. ira) account makes a lot more sense.  if you can't afford the apartment without her, then you can't afford to pay out her portion of the equity in the future.  which means she is not building equity, you are just borrowing money from her.  the safest and simplest thing for you to do is to agree on a number that does not include ""equity"". to be really safe, you might want to both sign something in writing that says she will never have an equity stake unless you agree to it in writing.  it doesn't have to be anything fancy. in fact, the shorter the better. i am thinking about 3 sentences should do the trick. if you feel you absolutely have to borrow money from her on a monthly basis to afford your mortgage, then i recommend you make it an unsecured loan.  just be sure to specify the interest rate (even if it is zero), and the repayment terms (and ideally, late payment penalties). again, nothing fancy, 10 sentences maybe.  e.g. ""john doe will borrow x$ per month, until jane doe vacates the apartment. after such time, john doe will begin repaying the loan at y$ per month...."" that said, borrowing money from friends and family almost never turns out well. at the very least, you need to save up a few months of rent so that if you do break up, you have time to find another roommate. disclaimer: i do not have any state-issued professional licenses."