There is never a nice time to talk about nasty things. But there is a phenomenon in our industry which many people suffer from - it’s an occupational hazard and it needs to be brought out into the open. At this time of year, when people in finance are often forced into close social proximity by the party season, it’s more important than ever to talk about that most unspoken of conditions - 'Buy Side Personality Disorder'.
As a syndrome, BSPD has a fairly obvious set of root causes – overwork, stress and salespeople. To work in the modern asset management industry is to spend long days in the thankless task of trying to outperform ever-more efficient markets. In the process, it becomes incumbent upon practitioners to give up on any real prospect of a social life outside of work.
So far, so traditional - people in finance have always tended to rely upon the office for socialization. Except that now, as investment managers cut staff and concentrate on passive and quant investment, it gets harder and harder to find much meaningful interaction in the office, either. And that means that today’s high-achieving buy side professional ends up being someone who has surprisingly little social contact with anyone except sell-side brokers.
There’s nothing wrong with the sell side, not intrinsically. Some of them are very clever and some of them are nice people; a few are both. But, painful though it is to admit, the first four letters of the phrase “sell-side” form a word which is not ornamental to the concept. They’re selling something, the buy-sider is their customer, and this simple fact shapes every conversation between the two parties. The problem is that it's really not psychologically healthy to spend too much time in the exclusive company of people who know it’s commercially suicidal to tell you that you’re wrong. If you’re in an environment where at least half the time you definitely are wrong, and the market will be along to prove it in a short while, the cognitive dissonance can become unbearable.
Buy Side Personality Disorder is the result of a combination of an underlying insecurity, combined with excessive exposure to sycophancy. It can manifest itself with a varied gallery of symptoms, and at different levels of seriousness.
Do you work on the buy-side? Are you a sufferer? Think about the last four weeks. During that period have you ever:
1. Made a comment at an internal meeting which you took from a sell-side note and passed it off as your own idea?
2. Claimed that you only take a sales call “to find out what the Street is thinking”?
3. Told yourself that a sell-sider of the opposite (or indeed same) gender genuinely fancies you, and that if it wasn’t unprofessional you’d probably be dating?
4. Blamed a sell-sider for a stock that you bought and lost money on?
5. Tutted to yourself about the formatting of an earnings model that you got an analyst to send to you?
6. Ordered a bottle of wine at lunch that you probably guessed would be over the salesperson’s expense limit?
7. Made a weak joke about an investor relations person and basked in the laughter and applause of a group of sell-siders at a conference?
8. Won an argument with one sell-side analyst purely by quoting the research of another?
9. Made an impassioned pitch at an investment committee for a stock that you had not heard of until two days ago?
10. Complained about the unacceptable volume of free research in your inbox?
If you answered “yes” to more than three of these questions, it’s quite likely that you are suffering from some form of BSPD. If you answered yes to seven or more, it’s extremely likely that your sell-side contacts (the ones that are really polite to your face) have a WhatsApp group dedicated to discussing your behaviour. Many people suffer from BSPD and never find out, until the day that their employer has a round of downsizing and they need to “reach out” to their former sellside contacts on LinkedIn. Don’t let it get that far.
Luckily, Buy Side Personality Disorder is as easy to cure as it is to diagnose. And with the holiday season coming round, effective treatment is close at hand. When you go back home for Christmas, try to speaking to your mum or your siblings in the same way that you interact with your brokers. Not only will you quickly find out whether you have BSPD, you’ll get a more or less immediate dose of shock therapy that will bring you back to earth with a bump. In the meantime, thanks for taking the call!
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