Buy Side vs Sell Side

The buy side is the part of finance that invests money. It includes pension funds, mutual funds, hedge funds, private equity firms, and the other institutions that buy stocks, bonds, loans, or whole companies and earn a return when those holdings rise in value. The sell side is the part that makes those investments possible. Investment banks and broker-dealers underwrite new stock and bond issues, advise companies on mergers, publish research, and execute trades, and they are paid a fee, a spread, or a commission whether or not the investment works out. A private equity firm is on the buy side. The bank that runs the auction for the company it buys is on the sell side.

The quickest test is how a firm gets paid. A sell-side firm earns revenue when a transaction happens: an underwriting spread on an initial public offering (IPO), an advisory fee when a merger closes, a commission or a bid-ask spread on a trade. A buy-side firm earns revenue from capital it manages: a management fee charged as a percentage of assets, often with a share of the profits. That test sorts most of the industry. A handful of businesses sit on both sides, and in mergers and acquisitions (M&A) the same two words describe something narrower: which party a banker represents in a single deal. The most common career move between the two runs from the sell side to the buy side, usually from an investment banking analyst job to a private equity associate seat after two or three years.

What the buy side and the sell side are

The names come from the relationship between the two groups. Sell-side firms sell securities and services: they sell newly issued shares and bonds to investors on behalf of the companies issuing them, and they sell research, trade execution, financing, and advice. Buy-side firms buy those securities and pay for those services. Banks work in both the primary market, where new securities are issued, and the secondary market, where existing securities trade between investors. A portfolio manager at a mutual fund is a customer of the bank's equity sales desk. A private equity firm is a client of the bank's leveraged finance group when it borrows to fund a buyout.

The sell side stands between two sets of clients. On one side are companies and governments that need capital or advice: an issuer selling stock in an IPO, a company selling a division, a buyer arranging debt. On the other side are the investors who supply capital. A bank earns fees from issuers for raising money and commissions or spreads from investors for trading with them, so its business depends on transaction volume.

Most buy-side firms invest someone else's money, and the industry separates two kinds of buy-side institution. Asset owners hold the money: public and corporate pension funds, university endowments, foundations, sovereign wealth funds, insurance companies, and family offices. Asset managers invest it for them: mutual fund companies, hedge funds, private equity firms, venture capital firms, private credit funds, and real estate funds. In a private equity fund, the asset owners are the limited partners who commit capital, and the private equity firm is the general partner that decides what to buy. Both are on the buy side, and both employ investment staff, but only the manager charges fees. Funds of funds and secondaries funds, which invest in other private funds, are buy-side managers as well.

Who is on each side

The table groups the main businesses by side. Firm names are examples, and several large firms appear in more than one row because they run businesses on both sides.

Side	Business	What it does	How it is paid	Examples
Sell side	Investment banking advisory (M&A, restructuring)	Advises companies and boards on buying, selling, merging, or recapitalizing	Retainers and success fees, mostly paid at closing	Goldman Sachs, Morgan Stanley, JPMorgan, Evercore, Centerview, Lazard
Sell side	Equity and debt capital markets, leveraged finance	Underwrites and arranges stock, bond, and loan issues	Underwriting spreads and arrangement fees	Bulge-bracket and large regional banks
Sell side	Sales and trading	Sells securities to institutions, makes markets, executes client orders	Commissions, bid-ask spreads, financing income	Bank trading desks, broker-dealers
Sell side	Equity and credit research	Publishes models, ratings, and price targets on public companies	Paid out of commissions or direct research payments	Research departments of banks and brokers
Sell side	Prime brokerage	Lends cash and securities to hedge funds, holds their assets, clears trades	Financing spreads and securities lending fees	Large bank prime brokers
Buy side (manager)	Mutual funds, exchange-traded funds, separately managed accounts	Manages diversified portfolios of public securities	Management fee as a percentage of assets	BlackRock, Vanguard, Fidelity, Capital Group
Buy side (manager)	Hedge funds	Trades public securities and derivatives, often with leverage and short positions	Management fee plus a share of annual gains	Bridgewater, Citadel, Millennium
Buy side (manager)	Private equity, venture capital, growth equity	Buys stakes in private companies or takes public companies private	Management fee plus carried interest on realized profits	Blackstone, KKR, Apollo, Sycamore Partners
Buy side (manager)	Private credit, real estate, infrastructure funds	Lends to companies or buys property and infrastructure assets	Management fee plus performance fee	Ares, Blackstone Real Estate, Brookfield
Buy side (owner)	Pensions, endowments, foundations, sovereign wealth funds, insurers, family offices	Allocates its own capital to managers and sometimes invests directly	No fees; staff are paid salaries and bonuses	CalPERS, Yale's endowment, Norway's Government Pension Fund Global

Names do not settle the question on their own. Citadel the hedge fund is buy side, while Citadel Securities, a separate market maker, is sell side. Goldman Sachs runs one of the largest sell-side franchises and also manages money for clients through Goldman Sachs Asset Management. The same split runs through real estate: a property brokerage that earns commissions on sales is sell side, and a real estate private equity fund that earns fees and a share of profits is buy side. The useful question about any job is which business it sits in and how that business is paid.

How each side makes money

Sell-side revenue

Underwriting is paid as a spread: the bank buys the new shares from the issuer at a discount to the offering price and sells them to investors at the full price. For mid-sized U.S. IPOs the spread barely varies. Jay Ritter's IPO statistics at the University of Florida, updated through December 31, 2025, show that 93.3 percent of the 1,141 IPOs from 2001 to 2025 that raised between $30 million and $160 million (in 2025 dollars) paid a gross spread of exactly 7 percent. Larger deals pay less. Among IPOs above $160 million, 45.1 percent paid 7 percent, and IPOs raising $1 billion or more paid a mean spread of 4.44 percent. Bond underwriting spreads are much smaller per dollar raised.

M&A advice is paid mostly on success. A bank is usually retained under an engagement letter that pays a small amount up front or at certain milestones and most of the fee only if the deal closes. Public-company merger proxies disclose the numbers. In its June 2025 proxy for the sale of Walgreens Boots Alliance to the private equity firm Sycamore Partners, Walgreens said it had agreed to pay its financial advisor Centerview Partners an aggregate fee of about $60 million. Of that, $15 million was payable when Centerview delivered its fairness opinion. The other $45 million, including an incentive fee of up to $10 million paid at Walgreens' discretion, depended on the transaction closing. Morgan Stanley, which delivered a second opinion to the board, was due a $10 million fee, half on delivering the opinion and half on closing.

Trading desks earn commissions on agency trades, the bid-ask spread when they buy from one client and sell to another, and interest and fees from lending cash and securities to hedge funds. Research has traditionally been paid for out of trading commissions, an arrangement called soft dollars.

Buy-side revenue

An asset manager charges a management fee on the capital it runs. For a low-cost index fund the fee is a small fraction of 1 percent of assets each year. For a hedge fund or private equity fund it has traditionally been around 2 percent, with a performance fee on top: hedge funds usually take a share of each year's gains, and private equity firms take carried interest, typically 20 percent of a fund's profits after investors get their capital back and, in most funds, a preferred return. Carry is paid when investments are sold, so a private equity firm can wait years to collect it, and a fund that loses money pays none.

An illustrative comparison shows why the two sides are paid so differently. Suppose a private equity firm manages a $1 billion fund with a 2 percent management fee and 20 percent carry. The fee brings in about $20 million a year while the fund is investing. If the fund eventually returns $2.5 billion to its investors, the $1.5 billion profit produces about $300 million of carry, before the hurdle and catch-up mechanics in the fund agreement. A bank advising on one of that fund's acquisitions is paid once, mostly at closing, and has no stake in whether the company is later sold at a gain.

Asset owners charge no fees. A pension fund or endowment earns returns for its beneficiaries or its institution, pays the managers it hires, and pays its own investment staff salaries and bonuses.

How the buy side and the sell side work together

Most of the sell side's daily work is done for buy-side clients, and most buy-side firms depend on banks to buy and sell what they own.

In an IPO, the company hires a group of underwriters. Bankers and the bank's equity capital markets desk take management on a road show to meet portfolio managers at mutual funds and hedge funds, collect indications of how many shares each investor would buy and at what price, and use that book of orders to set the offering price and allocate shares. The buy side's orders decide whether the deal prices at the top or bottom of the range.

In public markets, sell-side research analysts publish earnings estimates and host company meetings and conferences for investors. Salespeople call portfolio managers and buy-side analysts with ideas, and traders execute the resulting orders. Hedge funds also rely on prime brokers for borrowed money and borrowed shares. When a pension fund, a mutual fund, or a private equity firm that still owns shares after an IPO wants to sell a large block of stock, a bank's traders buy the block or line up buyers so the sale does not knock down the price.

In a buyout, the roles are visible in one deal. A company or its owner hires a bank to run a sale. The bank writes the confidential information memorandum, contacts likely buyers, and manages rounds of bids. Private equity firms and corporate buyers bid. The winning private equity firm finances the purchase as a leveraged buyout, and the debt comes from banks' leveraged finance groups or from private credit funds, which are buy-side lenders. In the Walgreens transaction, the debt commitment parties included Wells Fargo, JPMorgan, Goldman Sachs, UBS, Citigroup, Deutsche Bank, Mizuho, and PNC alongside private credit managers such as Sixth Street, Ares, and Oaktree. Banks cover private equity firms through financial sponsors groups because the firms buy and sell companies, borrow, and refinance often. The Walgreens proxy also disclosed that Morgan Stanley had received between $5 million and $15 million in financing fees from Sycamore and its affiliates in the prior two years, the kind of repeat relationship banks build with active buyers.

Buy-side and sell-side in M&A

Inside investment banking, the terms describe a mandate. On a sell-side mandate the bank represents the seller: it prepares marketing materials and the financial model, assembles a buyer list, runs the data room and management presentations, and negotiates price and terms across bid rounds. On a buy-side mandate the bank represents a buyer: it values the target, advises on bid strategy and price, and often helps arrange financing.

Banks generally prefer sell-side mandates. A seller that hires a bank has usually decided to sell, so the process is more likely to end in a transaction and a full success fee. A buy-side adviser is paid in full only if its client wins, and in an auction most bidders lose. Sell-side work also follows a set process the bank controls, which makes staffing and timing easier to plan.

The models differ by side. A sell-side team builds the seller's projections and a valuation range, usually from comparable companies, precedent transactions, and a discounted cash flow analysis, to set price expectations and answer buyers' questions. A buy-side team builds an acquisition model: a leveraged buyout model for a private equity buyer, or an accretion and dilution analysis showing the effect on earnings per share for a public company buyer.

A private equity firm is the buyer at entry and the seller at exit. Large firms do most of their buy-side work in house, using their own deal teams for valuation and diligence and hiring banks mainly for financing, and they hire a sell-side bank when they sell a portfolio company. The labels carry into other professions. Accountants prepare sell-side quality-of-earnings reports for sellers and buy-side reports for bidders, and lawyers speak of buy-side and sell-side counsel.

Buy-side vs sell-side research analysts

Both sides employ research analysts who study companies and build earnings models. The jobs differ in who reads the work and how it is judged.

A sell-side equity research analyst covers a list of public companies in one sector. The analyst builds and updates earnings models, publishes reports with a rating and a price target, questions management on earnings calls, and hosts investor meetings and conferences. The reports go to the bank's clients, and the average of sell-side earnings estimates for a company becomes the consensus estimate its quarterly results are measured against. The analyst's standing depends on how clients rate the work. Stacy Rasgon, a semiconductor analyst at Bernstein, wrote in a pinned 2020 thread on X that the job "is first and foremost a client service job" and that clients who do not like an analyst "will not vote for you no matter how good your work is." Rasgon also wrote that clients do not care much about the buy, hold, or sell rating itself; they care about how much conviction the analyst has on the stock's main debate.

A buy-side analyst works for a fund. The research is private, written for the portfolio manager, and judged by whether the positions it leads to make money. A buy-side analyst at a long-only fund or hedge fund may cover more companies than a sell-side analyst, read the sell side's work as one input among many, and spend little time writing for an outside audience. In private equity, the analyst works on one company at a time in far more depth, with access to nonpublic information through the sale process.

The two kinds of analyst are linked by money. Portfolio managers and buy-side analysts rate the brokers whose research and company meetings helped them, often in a periodic broker vote, and those ratings help decide how the fund's commissions or research budget are divided among banks. Sell-side analysts compete for those votes with models, calls, and access to management. Companies can make that access harder for analysts who publish negative views, and banks have at times pressed analysts to stay positive on companies the bank wanted as banking clients.

Conflicts and the rules that followed

Sell-side research sits inside banks that also want underwriting and advisory business from the companies being covered. During the late 1990s technology boom, analysts promoted the stocks of banking clients. In April 2003 the Securities and Exchange Commission (SEC), state regulators, and self-regulatory organizations announced a settlement with ten firms that totaled $1.3875 billion: $387.5 million of disgorgement and $487.5 million of penalties, $432.5 million to fund independent research, and $80 million for investor education. The firms had to separate research from investment banking and buy independent research for their clients for five years. Then-New York Stock Exchange chairman Dick Grasso put the principle in the release: "a banker is a banker and an analyst is an analyst."

Rule 2241 of the Financial Industry Regulatory Authority (FINRA), the self-regulatory organization for U.S. broker-dealers, now governs equity research conflicts. It bars investment bankers from reviewing or approving research before publication, from supervising analysts, and from influencing their pay, and it prohibits paying analysts for specific banking deals. It bars analysts from pitches and road shows, sets quiet periods after offerings the firm underwrote (at least 10 days after an IPO, though IPOs by emerging growth companies are exempt), and requires each report with ratings to disclose the share of the firm's ratings that are buy, hold, and sell and whether the firm has done banking work for the company. None of this applies to buy-side research, which is not distributed to the public.

How the buy side pays for research

Until May 1, 1975, U.S. brokers charged fixed commissions set by the exchange, and because they could not compete on price, they competed by giving clients research and other services. The SEC ended fixed commissions on that date. Congress then added Section 28(e) to the Securities Exchange Act, a safe harbor that lets a money manager pay a broker more than the lowest available commission if the extra buys research and brokerage that benefit the manager's clients. Commission dollars used this way are called soft dollars or client commissions, and they remain the main way U.S. managers pay for sell-side research.

Europe took a different path. Under the revised Markets in Financial Instruments Directive (MiFID II), effective January 2018, managers had to "unbundle" research from execution and pay for it either from their own revenue or through a separate research charge agreed with clients. The UK's Financial Conduct Authority found that the rule had adverse effects on the research market and, from August 1, 2024, allowed firms to pay for research and execution jointly again if they meet its conditions.

What the buy side has to disclose

Large buy-side firms report some public holdings. An institutional investment manager with investment discretion over at least $100 million of Section 13(f) securities, which are mostly U.S. exchange-traded stocks, closed-end funds, and exchange-traded funds, must file Form 13F with the SEC within 45 days after each quarter ends. The filings show what mutual funds and hedge funds owned at quarter end. Private companies owned by private equity funds do not appear, because they are not 13(f) securities.

Licenses and regulation

Sell-side firms are broker-dealers, registered with the SEC and members of FINRA, and most client-facing employees must pass FINRA exams. Investment bankers need the Securities Industry Essentials (SIE) exam and the Series 79, a 75-question test that takes two and a half hours, requires a score of 73 to pass, and costs $395. The Series 79 covers offerings, M&A, tender offers, and restructurings, but a banker who markets an offering directly to investors on a road show also needs the Series 7 or the Series 82. Research analysts who write reports for clients need the SIE and the Series 86 and 87, and candidates who have passed Levels I and II of the Chartered Financial Analyst exam are exempt from the Series 86. Salespeople generally need the Series 7, and traders of equity, preferred, and convertible debt securities need the Series 57, the Securities Trader exam.

Buy-side firms are regulated as investment advisers. Managers of mutual funds, hedge funds, and private equity funds register with the SEC under the Investment Advisers Act of 1940, unless they qualify for an exemption. The SEC's 2011 rules exempt advisers solely to private funds with less than $150 million of U.S. assets under management from registration, though those exempt reporting advisers still file some information. Investment professionals at an adviser do not need FINRA licenses to analyze and buy companies, so a private equity associate who joins from a bank usually lets those licenses lapse unless the firm runs its own broker-dealer, as some large managers do to arrange financing and syndicate deals. Adviser staff are still covered by the adviser's code of ethics: SEC Rule 204A-1 requires each registered adviser to have one, and staff with access to nonpublic client or recommendation information must report their personal holdings and quarterly trades and get approval before buying into an IPO or a private placement.

The work and the skills

Job titles on the two sides overlap, but the work divides along a different line: roles built around transactions in whole companies, roles built around traded securities, and roles that support either.

On the sell side, deal roles are investment banking advisory and capital markets. Junior bankers build models, write marketing materials and board presentations, coordinate with lawyers and accountants, and keep several live deals moving at once. Senior bankers spend most of their time winning mandates and managing clients. The bank's job ends when the deal closes or the securities are sold.

On the buy side, deal roles are private equity, growth equity, venture capital, and private credit. A private equity associate evaluates companies, runs diligence, builds the model behind the investment committee's decision, and after closing works with the portfolio company on reporting, add-on acquisitions, and the plan to raise earnings. The firm owns the result for years.

Public-markets roles split the same way. Sell-side traders and salespeople serve clients and manage the bank's risk, and research analysts publish. Buy-side analysts and portfolio managers decide what to own and how much, and their performance is measured against a benchmark or in absolute returns.

Support roles, such as corporate finance, treasury, investor relations, and risk management at ordinary companies, sit on neither side. They do not raise or invest outside money or charge for transactions, and their pay is set by internal budgets.

The skills differ accordingly. The sell side rewards speed, accuracy under deadlines, client management, and the ability to run a process. The buy side rewards investment judgment: deciding which opportunities to reject, sizing positions, and, in private equity, understanding how a business makes money well enough to own it. Banking analysts who move to private equity already know how to build the model. The new part of the job is recommending whether the firm should invest and defending that view to the investment committee.

Hours and lifestyle

Sell-side hours are set by clients and deal timetables. Investment banking analysts routinely work late nights and weekends during live deals, and a deal can arrive at any time. Sales and trading starts before the market opens and is busiest during market hours, with fewer late nights. Research analysts are busiest during earnings seasons; Rasgon's thread advises analysts to build models "simple enough to update at 2am on an earnings night."

Buy-side hours vary more by firm type. Private equity associates often work banking-like hours during a live process and shorter but still long weeks otherwise, and large-fund associates can match banking for long stretches. Hedge fund hours follow the market, with the pressure coming from daily profit and loss. Long-only asset managers and pension investment offices tend to have the most predictable schedules.

The pressure also differs. On the sell side it comes from clients, deadlines, and the volume of work. On the buy side it comes from being responsible for investment results. A hedge fund or long-only manager that trails its benchmark loses assets as clients withdraw money, which cuts fees and bonuses, and in private equity a bad deal stays in the fund's track record for years.

Pay

Both sides pay a base salary and an annual bonus. The differences are in what drives the bonus and what comes on top of it.

Sell-side bonuses depend on the bank's revenue, the group's revenue, and individual reviews, and senior bankers receive part of their bonus as deferred stock. Pay tracks deal and trading volume closely. Johnson Associates' August 2026 projections put 2026 incentive pay in investment and commercial banking up 10 to 15 percent or more from 2025, with equity underwriting and equity sales and trading up 20 to 30 percent or more and M&A advisory up 15 to 20 percent.

Buy-side pay depends on the type of firm. Mutual fund and other long-only managers pay salary and bonus tied to fund performance and the firm's fee revenue. Hedge funds can pay portfolio managers a share of the profits they generate, so pay rises and falls with results. Private equity firms pay salary and bonus at every level and add carried interest, usually starting around the vice president or principal level and growing with seniority. The same Johnson Associates report projected 2026 incentives at large private equity firms up 2.5 to 7.5 percent and flat at mid-sized and smaller firms, figures that exclude carried interest, and cited record low distributions in private equity. Hedge fund incentives were projected up 5 to 15 percent and traditional asset management up 7 to 11 percent.

Pay depends more on the specific job than on the side. Many investment bankers earn more than venture capital investors at the same level, and buy-side jobs without performance fees, including many at long-only managers and pension funds, often pay less than banking. At junior levels the gap between a banking analyst and a first-year private equity associate is smaller than the reputation suggests. The gap opens at senior levels. A senior banker's pay is tied to the fees the banker brings in. A private equity partner's carry is tied to profits on billions of dollars of fund capital, so it can far exceed banking pay when funds perform, though it arrives years later and depends on exits.

Careers on each side

The sell side hires in volume. Banks recruit large analyst classes from undergraduate programs, mostly through summer internships before senior year that convert into full-time offers, and associates from MBA programs, and they train new hires on modeling and process. The buy side hires fewer people and has historically preferred candidates who have already been trained. The usual private equity career path starts with two or three years as an investment banking analyst, and many hedge fund and long-only analysts start in equity research or sales and trading. Some large private equity firms, hedge funds, and asset managers do hire undergraduates directly, and pension funds and asset managers run their own analyst programs.

The common moves follow the work. Investment banking analysts move into private equity, growth equity, corporate development, or private credit, often through the recruiting process large private equity firms run with headhunters a year or more before the analyst would start. Equity research analysts move to long-only funds or hedge funds covering the same sector. Traders move to hedge fund trading or execution roles. Hedge funds hire on a rolling basis when a seat opens, and stock pitches carry much of the weight in their interviews. Moving between deal roles and public-markets roles is harder than moving from the sell side to the buy side within the same kind of work, because the skills and networks differ.

The same patterns apply to choosing a first job. Private equity firms, growth equity firms, private credit funds, and corporate development teams all recruit from investment banking analyst classes, so a deal job at a bank keeps the widest range of later buy-side moves open. Equity research and sales and trading lead mainly to hedge funds and long-only managers. A first job in a support role, such as corporate finance at an ordinary company, makes a later move into either kind of investing harder.

Promotion works differently on each side. Banks promote along a fixed ladder of analyst, associate, vice president, director, and managing director, with large classes at each junior level. Buy-side firms have fewer senior seats, the people in them tend to stay, and promotion depends on openings and on a person's investment record. Many large private equity firms hire associates into a two- or three-year program after which most leave for business school, another fund, or a portfolio company.

Timing matters. The move to the buy side is easiest after a few years of sell-side training and before a person becomes senior and expensive, and the same pattern repeats after business school. Moves from the buy side back to the sell side happen too, usually when a fund closes or an investor wants a more predictable path, but they are less common.

In interviews, candidates are often asked why they want to move from the sell side to the buy side. Interviewers listen for an interest in making investment decisions and owning the result, backed by examples from the candidate's deals. Answers about hours or pay tend to land badly.

Open associate and analyst roles at private equity firms are listed on Private Equity Jobs, and the companies directory profiles the firms that post them.

Where the line blurs

Several businesses do not fit the payment test cleanly.

• Asset managers inside banks. Goldman Sachs Asset Management, J.P. Morgan Asset Management, and Morgan Stanley Investment Management are buy-side businesses owned by sell-side firms, and some banks also run principal investing or merchant banking groups that invest the bank's own capital. Under the Volcker Rule, U.S. banking entities are generally prohibited from proprietary trading and from investing in or sponsoring hedge funds or private equity funds, subject to exemptions. Broker-dealers must keep written policies against the misuse of material nonpublic information under Section 15(g) of the Securities Exchange Act, and investment advisers must do the same under Section 204A of the Investment Advisers Act. A bank that runs both kinds of business keeps information barriers between them, so a banker working on an unannounced deal cannot pass what the deal team knows to the bank's traders or portfolio managers.
• Proprietary trading and market makers. Trading firms that commit their own capital, such as Jane Street, invest for their own account like the buy side but earn much of their revenue providing liquidity like the sell side. They are usually classified by function, with market making counted as sell side.
• Private wealth management. Advisers who sell products and route trades are usually counted as sell side; teams that run discretionary portfolios for wealthy clients are closer to asset management. Banks report wealth management separately from both investment banking and asset management.
• Corporate development. A corporate development team buys and sells businesses for its employer. In M&A it sits on the buy side or the sell side of each deal, but it is a corporate function with no outside investors.
• Consulting and other advisers. Strategy consultants, accountants, and law firms sell advice for fees and are sometimes counted as sell side, though most finance recruiters treat them as a separate category. Private equity firms hire consultants for commercial due diligence, which is one route from consulting into private equity.
• Asset owners investing directly. Large pension funds and sovereign wealth funds have built direct and co-investment teams that buy stakes in companies alongside, or instead of, private equity managers. They are buy side, but they are clients of private equity firms as well as competitors.
• Placement agents and secondaries advisers. Firms that raise money for private equity funds or run sales of fund stakes in the secondaries market are sell-side intermediaries serving buy-side clients.

Common questions

Is private equity buy side or sell side?

Buy side. A private equity firm raises capital from investors, buys companies, and earns management fees and carried interest. It hires sell-side banks for financing and for sale processes.

Is investment banking buy side or sell side?

Sell side. Investment banks advise on deals and underwrite securities for fees. Inside banking, "buy-side" and "sell-side" mandates describe which party the bank represents in an M&A deal.

Is equity research buy side or sell side?

Both exist. Sell-side analysts at banks publish research for clients. Buy-side analysts at funds write private research for their own portfolio managers.

Is wealth management buy side?

It depends on the job. Advisers who sell products and execute trades are usually counted as sell side, and teams that manage discretionary portfolios are closer to the buy side.

Which pays more, the buy side or the sell side?

At junior levels the difference is small. At senior levels the buy side has the higher ceiling because performance fees and carried interest scale with capital, but that pay is less certain and arrives later.

Can you start on the buy side out of college?

Yes, though fewer seats exist. Some large private equity firms, hedge funds, asset managers, and pension funds hire undergraduates directly. Most buy-side investment professionals start on the sell side.

Is corporate development buy side?

It is a corporate function, not an investment firm. A corporate development team acts as the buyer or the seller in its company's deals.

What does buy-side mean in M&A?

The buy side of a deal is the acquirer and its advisers. A buy-side mandate means a bank is advising a buyer; a sell-side mandate means it is advising the seller.

Sources

• Jay R. Ritter, University of Florida, IPO Statistics, table of gross spreads updated December 31, 2025: share of 2001 to 2025 IPOs with a 7 percent gross spread and mean spreads by deal size.
• Walgreens Boots Alliance, definitive proxy statement for the merger with affiliates of Sycamore Partners (filed June 6, 2025): Centerview and Morgan Stanley fees, debt commitment parties, Morgan Stanley fees from Sycamore.
• U.S. Securities and Exchange Commission, Ten of Nation's Top Investment Firms Settle Enforcement Actions Involving Conflicts of Interest Between Research and Investment Banking (April 28, 2003).
• FINRA, Rule 2241, Research Analysts and Research Reports.
• U.S. Securities and Exchange Commission, Commission Guidance Regarding Client Commission Practices Under Section 28(e), Release 34-54165 (2006): end of fixed commissions on May 1, 1975, and the Section 28(e) safe harbor.
• Financial Conduct Authority, PS24/9: Payment optionality for investment research (2024).
• U.S. Securities and Exchange Commission, Frequently Asked Questions About Form 13F.
• FINRA, Series 79 Investment Banking Representative Exam, Series 86/87 Research Analyst Exam, and Series 57 Securities Trader Representative Exam.
• U.S. Securities and Exchange Commission, Release IA-3222 (2011): exemptions for advisers to private funds with less than $150 million of assets under management.
• 17 CFR 275.204A-1, investment adviser codes of ethics.
• Securities Exchange Act Section 15(g), 15 U.S.C. 78o(g) and Investment Advisers Act Section 204A, 15 U.S.C. 80b-4a: written policies to prevent misuse of material nonpublic information.
• Board of Governors of the Federal Reserve System, Volcker Rule.
• Johnson Associates, Q2 2026 Trends and Year-End Projections (August 5, 2026): projected 2026 incentive pay changes by business line.
• Stacy Rasgon, "How to Succeed on the Sell Side", thread on X (June 27, 2020).