IDEAS home Printed from
   My bibliography  Save this article

Can research committees add value for investors. An analysis of Lehman Brothers Ten Uncommon Values recommendations


  • Groysberg, Boris

    () (Harvard Business School)

  • Healy, Paul

    () (Harvard Business School)

  • Gui, Yang

    () (ITG)


Since 1949 Lehman Brothers has used an investment committee to select the top ten recommendations made by its analysts each year. We examine the performance of this committee’s recommendations and find that on average its selections generated abnormal returns of 2.7% at the recommendation announcement and 4.5% for the remainder of the year. This performance cannot be explained by changes in analyst recommendations and/or target prices that accompany the committee report. Nor was it due to analyst screening ability since the returns were higher than those earned from investing in analysts’ top stock picks that were not elected by the committee. Finally, we find that abnormal announcement returns and abnormal trading volume at the report publication are correlated with market-adjusted returns for the prior year’s stock selections, suggesting that investors believe that a successful process in one year is likely to be repeated the following year. We believe that these findings are particularly interesting given recent efforts to require firms to use research recommendation committees to improve the quality of research.

Suggested Citation

  • Groysberg, Boris & Healy, Paul & Gui, Yang, 2008. "Can research committees add value for investors. An analysis of Lehman Brothers Ten Uncommon Values recommendations," Journal of Financial Transformation, Capco Institute, vol. 24, pages 123-130.
  • Handle: RePEc:ris:jofitr:0831

    Download full text from publisher

    File URL:
    File Function: Full text
    Download Restriction: no

    More about this item


    investment committee; performance of stock recommendations; analysts; regulations; quality of research;

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G17 - Financial Economics - - General Financial Markets - - - Financial Forecasting and Simulation
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ris:jofitr:0831. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Prof. Shahin Shojai) or (Rebekah McClure). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.