Independent credit research shop Gimme Credit is launching intraday research later this month to provide credit analysis of daily events in the market as event-driven situations play an increasing role. The service is set to be launched on June 15. "Since 2002, there has been a lot more risk of surprises with the Enron and WorldCom, etc. [situations], which heightened everyone's awareness something can jump up and bite them without any warning," said Arthur Rosenzweig, managing director of Gimme Credit.
Rosenzweig explained the spectacular growth of hedge funds, which he referred to as "more of in and out, short and long-type investors," has also increased the market's focus on daily action. "Another equally large factor is the explosion of the credit derivatives market, which trade a lot more easily than cash bonds... which has ballooned the amount of action and events that can have an impact," he added. The intraday pieces product will give investment recommendations based on daily market occurrences. "We'll avoid elevator-type of commentary [i.e. bonds are trading up or down on the news] and we don't want chit-chat," clarified Rosenzweig. The intraday service will also offer so-called credit scores for companies to assess the direction of a company's credit quality as it may relate to its valuation.
Additionally, Rosenzweig noted the research outfit is looking to hire analysts to expand its high-yield service, which was started a year ago. He indicated the firm would like to increase its focus on distressed situations which includes cross-asset coverage. Gimme Credit is also developing a European product to cover the entire quality spectrum. Rosenzweig declined to be more specific about potential hires.