damien,
you are correct that barra sells tools for risk measurement, and perhaps in an ideal world, a risky "sideways" market would see more need for sophisticated analytic tools, than a dumb guy's perma-bull market would.
however, a risky sideways market would cause massive outflows from mutal funds, and falling popularity of the religion of stock investment "for the future," a la peter lynch, motley fool, and that entire popular mythology which has been waning in popularity over the last few months as people are questioning their "in it for the long run" mantras. it is, of course, much easier to be "in it for the long run" when your stocks are going up instead of down or sideways.
anyway, a less popular stock market means fewer mutual fund managers, lighter volume, fewer traders, fewer hedge funds, etc, etc, etc... and thus less of a market for barra's products.
the alternate scenario of course is that we will see a rise in professional management and managers trying to out-techie and out-smart one another, which would bode well for barra.
i certainly don't know what the future holds, but it may not be so rosy for barra... |
