AMWatch

Ex-ABG banker starts research firm to target market’s blindspot

The former head of markets at ABG Sundal Collier in Copenhagen has started a firm he says will address a gaping hole in the market for equity research.

HC Andersn Capital CEO Tue Østergaard when he was head of equities at Gudme Raaschou. | Photo: Steen Wrem/ERH

Tue Østergaard says the firm, HC Andersen Capital (named after the Danish author of fairy tales), will provide research on the growing universe of small- and mid-caps that have dropped off the radar for most broker banks in recent years.

Østergaard plans to focus on Danish companies outside the country’s benchmark index, which he says currently “get zero attention.” They also get “zero transparency and visibility in the market,” he said in an interview.

Since Europe passed its revised Markets in Financial Instruments Directive in 2018, banks and brokers have tended to focus on the biggest companies. That’s after MiFID II, as it’s known, required financial firms to unbundle fees in an effort to create more transparency around the cost of research.

After 20 years working in the brokerage industry, Østergaard says the sector is now “heavily under pressure.” The latest changes “will push all banks and brokers into the large cap area,” he said. “That’s where commission is to be earned,” while small- and mid-caps “will be overlooked,” he said.

HC Andersen Capital, which has been up and running since July, plans to provide research and investor events via a digital platform. Companies that want research written about them for investors need to pay for it. Clients to date include Better Collective A/S, Boozt AB and Hafnia Ltd.

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