What Do You Say?

September 16, 2008
Michael Sheehan

Physician's Money Digest, July15 2004, Volume 11, Issue 13

What's so hard to understandabout the terms buy, sell, or hold?Despite taking a lot of flak about crypticstock ratings, Wall Street brokeragesare still putting less-than-simplelabels on stocks they analyze. In WallStreet jargon, "overweight" doesn'tmean "obese," but does it mean "buy"?Or if you already own that stock, doesit just mean "hold"? If "outperform"is applied to a stock in an underperformingsector, does it really mean"sell," or can it mean "hold"? TheNational Association of SecuritiesDealers (NASD) and the New YorkStock Exchange adopted rules twoyears ago to make analysts' ratingsmore intelligible. The NASD is nowmounting a full review of Wall Streetbrokerages to see if firms are complyingwith the most recent rules andwhether investors need more help todecipher esoteric stock-analysis terms.