Goldman Sachs has climbed to the top of Alpha magazine’s Asian analyst list, thanks to Paul Bernard, Goldman Sachs Asia’s co-director of Pan-Asia research, and his winning approach: Have analysts think like hedge fund managers. The key to Goldman’ success, according to Alpha – an Institutional Investor publication – is a “current investment list” the firm introduced in November 2002. That list contains Goldman’s “best idea at any given moment” and includes stocks that analysts predict will provide 15% to 20% annual absolute return. The system works, as the list has returned a whopping 205% since its launch, gaining 55% alone last year. Goldman’s approach has made the firm the clear choice of hedge fund managers when asked to choose their favorite Asia analysts. The firm was named best in 13 of 17 sector teams – almost as much as both numbers two and three – JP Morgan Securities and Morgan Stanley – put together. UBS, which was hedgies’ no.1 choice last year fell to fourth, while Citigroup and Lehman Brothers tied for fifth. UBS’ fall from the top spot is due in part to the departure of many of its top analysts, though Nicholas Pink, UBS’ Asia research head, has been restocking the team.
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