The National Association of Securities Dealers has launched an education effort aimed at helping investors understand research and recommendations made by equity analysts.

The NASD has prepared a Guide to Understanding Securities Analyst Recommendations and an accompanying Glossary of Analyst Research Terms. The guide explains what analysts do and the role that they can play in making an informed investment decision.

The guide covers two basic issues: the fact that analysts’ ratings today do not have clear, standardized meanings; and, the potential conflicts of interest that an investor should be aware of in assessing the usefulness of any particular analyst recommendation.