Ratings Mean Zilch

I received this email today from a prominent portfolio manager:

Attached is an internal Smith Barney memo dated March 2002 (a full two years after the peak of the NASDAQ) that shows the job of the Wall Street research analyst was to support the investment banking function. We all knew that things like that went on – it’s just scary to see it so vividly explained in writing. No wonder most mutual fund managers underperform – they still lean way too heavily on Street research.”

You can read memo here (PDF).