Equity Research Offshoring: Why the Model Has Changed

Equity research was one of the first front-office functions to offshore.
From the early 2000s, banks and investment firms successfully used offshore teams to support equity research through modelling, data work, and earnings-related updates.

For a long time, this approach worked well.

Offshore analysts handled repeatable analytical tasks reliably, enabling onshore teams to scale coverage and manage growing data requirements without materially increasing headcount.

Why the Operating Model Has Evolved

The environment in which equity research operates has changed.

Following the introduction of MiFID II, equity research teams became smaller and more focused. Coverage responsibilities increased, while tolerance for rework, delay, or misalignment decreased.

At the same time, advances in automation and AI have taken over much of the pure number-crunching work that once defined offshore equity research support.

As a result, while scaling output is often still the objective, the way teams achieve that scale has had to change.

What Judgement-Led Equity Research Support Looks Like

Judgement in this context does include analytical decision-making — subject to onshore approval.

It means understanding the research context well enough to take responsibility for analytical choices that sit within an agreed framework, so outputs are immediately usable by senior analysts and portfolio managers.

Judgement-led offshore equity research analysts are able to:

  • Adjust assumptions in response to earnings and management guidance

  • Decide which sensitivities and scenarios are most relevant

  • Apply house methodology consistently across models

  • Anticipate likely PM or internal review questions

  • Flag issues or inconsistencies proactively, rather than mechanically updating numbers

This level of contribution comes from experience, continuity, and close alignment with the onshore team.

Integration Is Now Central to Offshore Equity Research

In the current environment, offshore equity research support works best when teams move beyond the older, number-crunching-only offshore model.

In practice, effective integration means:

  • Named analyst ownership rather than pooled delivery

  • Ongoing coverage of the same companies and sectors

  • Direct interaction with buy-side or sell-side teams

  • Oversight by senior researchers who understand end-user expectations

This allows offshore analysts to scale output without sacrificing judgement, rather than simply increasing processing capacity.

Implications for Buy-Side and Sell-Side Teams

For both buy-side and sell-side equity research teams, outsourced equity research is still frequently used to increase capacity.

The difference today is that teams are seeking to:

  • Scale output while preserving analytical judgement

  • Reduce dependency on stretched senior analysts

  • Improve resilience during earnings cycles

  • Maintain consistency as coverage demands grow

To do this well, teams need to get past the older offshore models built primarily around mechanical execution.

The Current State of Equity Research Offshoring

Equity research offshoring has not disappeared — it has matured.

The models that continue to work are those built around:

  • Judgement-led analysts

  • Long-term integration

  • Clear ownership and oversight

  • Alignment with buy-side and sell-side standards

This is the form of offshore equity research support that allows teams to scale effectively in a post-MiFID II, AI-enabled research environment.

Related: Equity Research Support

Equity Research Support
How integrated offshore equity analysts support buy-side and sell-side teams with modelling, earnings analysis, valuation work and judgement-led research — under onshore oversight.