Equity Research Ranking
for Chinese Security Firms
In an attempt to impartially assess the equity research competencies of Chinese sell-side firms, we have developed a unique ranking method. This method utilizes Adjusted Proportional Mean Absolute Forecast Error (MAFE) to determine the forecast accuracy of firms dealing with stocks listed in Shenzhen or Shanghai. In addition to the Prediction Accuracy Score, we also compute a Prediction Frequency Score to gauge the level of research activity undertaken by these sell-side firms.
Our assessment, based on the annual EPS projections for 2022, covered 78 sell-side firms and 2887 stocks listed in Shanghai or Shenzhen. The top three firms in terms of accuracy were First Shanghai Securities, Gamma Securities, and Donghai Securities. In terms of activity, the most proactive firms in making projections were Tianfeng Securities, Essence Securities, and Everbright Securities.
The updated ranking for 2023 will be available in mid-2024, once all listed companies have published their annual reports. Rankings segmented by sector can be provided upon request.
Sell-side Firms  | Sell-side Firms (Chinese) | Accuracy Rank (2022) | Accuracy Score (2022)  | Accuracy Rank Change from 2021 | Frequency Rank (2022) | Frequency Score (2022) | Frequency Rank Change from 2021 |
|---|---|---|---|---|---|---|---|
| Gamma Securities | 嘉谟证券 | 2 | 95.37 |  1 | 61 | 0 | 9 |
| Great Wall Glory Securities | 长城国瑞证券 | 12 | 90.56 |  27 | 52 | 0.7 | 5 |
| Topsperity Securities | 德邦证券 | 15 | 89.34 | New | 30 | 13.79 | New |
| Zhongtai Securities | 中泰证券 | 20 | 88.39 | 3 | 5 | 68.72 | 2 |
| Huaxi Securities | 华西证券 | 24 | 86.95 | 3 | 10 | 52.05 | 4 |
| Huaan Securities | 华安证券 | 34 | 84.79 | 20 | 14 | 35.69 | 8 |
| Southwest Securities | 西南证券 | 39 | 84.06 | 13 | 9 | 53.04 | 1 |
| Capital Securities | 首创证券 | 43 | 83.38 | 7 | 20 | 25.91 | 9 |
| Pacific Securities | 太平洋证券 | 47 | 82.55 | 5 | 17 | 31.6 | 6 |
| AVIC Securities | 中航证券 | 49 | 82.21 | 18 | 31 | 13.12 | 3 |
| Haitong International Securities | 海通国际 | 51 | 81.83 | 8 | 37 | 8.43 | 23 |
| Century Securities | 世纪证券 | 55 | 79.28 | 3 | 51 | 0.74 | 10 |
| Shengang Securities | 申港证券 | 57 | 76.41 | 4 | 42 | 5.09 | 4 |
| East Asia Qianhai Securities | 东亚前海证券 | 59 | 71.1 | 5 | 39 | 6.4 | 15 |
| Yuekai Securities | 粤开证券 | 61 | 0 | 15 | 59 | 0.1 | 14 |
| Donghai Securities | 东海证券 | 3 | 94.38 | New | 56 | 0.26 | New |
| Soochow Securities | 东吴证券 | 5 | 92.97 | 8 | 4 | 69.83 | 3 |
| BOC International (China) | 中银证券 | 7 | 92.16 | 3 | 19 | 30.25 | 4 |
| Dongguan Securities | 东莞证券 | 8 | 92.15 | 11 | 35 | 9.72 | 5 |
| Everbright Securities | 光大证券 | 11 | 90.69 | 7 | 3 | 70.43 | 1 |
Note: The ranking excludes 17 security firms with less than 5 predictions.
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Our Adjusted Proportional MAFE approach has two primary features:
It is adjusted for the timing of the predictions. Specifically, we have considered that forecasts generally become more precise when made at a later stage with more data at disposal. Thus, the time factor influencing the accuracy of predictions is eliminated from our computation and ranking.
It is proportional as it compares the prediction accuracy of individual sell-side firms with industry averages.
Data sources: EPS projections and actual data from EastMoney accessible at https://www.eastmoney.com/.
Technical notes available upon request. Email: admin@oxbridge-econ.com.