HISTORY

Roulston Research's heritage stems from the research boutique Roulston and Company, began in 1963 by Thomas Roulston Sr. It was formed as an independent institutional research firm recognizing the conflicts of investment banking and proprietary trading desks with front running investors' interests. The paradigm was that research without bias from other corporate profit conflicts held greater value. Combined with unique methods and disciplines of gathering research, the communication of proprietary knowledge gives an institutional investor a distinct advantage to invest client assets.

Roulston Research seeks to find unique industry resources together with networking buyside and sell side participants to provide value added services to customers. Network of information flow amongst all investors is constantly updated by a steadily increasing reliance on internal research by investment firms and hedge funds. This "brotherhood's" only conflict is the premise that what is shared has already been acted upon. Information becomes recognized based on the quality and intelligence of the source.

Finding and sourcing better and more reliable resources is the objective of Roulston Research. Providing the forums for idea sharing via personal meetings, the internet and networking participants together is the product of Roulston Research.

The historic research paradigm has changed. Commission payment for research is being scrutinized for both conflicts and quality. Increasingly research payment and trading execution are separated due to customer requests, trading costs, and best execution definitions. The increasing reliance on internal research resources of buyside institutions has proliferated over the last decade as sell side sources have increasingly derived their income from other services perceived in conflict with research. These services (including investment banking, underwriting, market making among others) are added benefits to buyside institutions. Roulston Research does not provide these services.

Improved communication systems of the internet and other resources have further redefined the traditional research services provided by brokers and the delivery of information. These changes have further commoditized traditional brokerage research and the perceived value provided for public company coverage. Regulators of the brokerage industry, through new laws, have separated revenue and compensation systems amongst brokers' different products further causing a "brain drain" of talent to the perceived higher income of the buyside in the investment business. While investment banking and research have seemingly obvious conflicts, the compensation and bonus systems were commingled until the last few years when adjustments were initiated by regulatory changes. These changes in compensation have additionally created a significant increase in the number of independent research providers. These independent analysts have both a need to market their services and to network with buysiders.

Today there are approximately 8,900 public companies of which approximately 3,900 have one or less sell side analysts providing written company coverage. Smaller and mid sized companies do not have large enough investment banking needs to support other brokerage revenue to justify research coverage. With so many public companies and different reasons for sell side coverage there is significant fragmentation of sell side resources creating a need for a source to consolidate the overwhelming information flow.

Institutions are in transition in both their research and historic trading practices. Sources of information and research are being redefined. The "old boy" relationship of the buyside and sell side has increasingly come under regulatory scrutiny and analysis of conflicts of interest. Practices of entertainment, bartering and conflicts of payments for services not directly related to research have forced a discomforting change to the traditional ways of conducting business. Corporate disclosure law changes combined with the instant access to news via technology means that unique actionable information takes potentially greater resources or an expanded network of sources.