Buy side

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Buy side is a financial term used in financial security trading.

As opposed to the sell side, which refers to banks and brokerages who are required to be market makers in a given security, the buy side refers to firms which buy and sell as customers of these market makers, usually taking speculative positions or making relative value trades. Buy side firms participate in a smaller number of overall transactions, and aim to profit from market movements and accruals rather than through risk management and the bid-offer spread. In fact, the "buy side" refers to the buyers exchange services, not the buyers of financial securities and derivatives themselves.

Mutual funds, Unit Trusts, hedge funds, pensions, and proprietary trading desks are the most common types of buy side agencies.

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