Alternative data is becoming an increasingly popular factor in investments. Investors are partially relying on unstructured data to make a more educated business investment. Over the past several years, alternative data has become more attainable through mobile devices and is reflected in investor success.
Investors are now using data from everything from social media apps to government filings in order to gauge a company’s performance prior to revenue reports. Perhaps the most interesting of such data being used is from RS Metrics. Investors have partnered with RS Metrics to obtain satellite images of JCPenny’s parking lots across the country. With these images, investors were able to see an increase in traffic between April and May, thus gaining an advantage on real-time company performance which was then used to trade JCPenny shares.
Companies like RS Metrics are in demand now more than ever. Investors are realizing the benefit of alternative data in conjunction with the market. New tech firms are continuously emerging in the market in hopes of making the alternative data they’ve gathered and processed into a profit. If investors are able to obtain data, that projects a quarterly earning prior to a company’s report, then they have an advantage on competition.
Social media platforms are also realizing the relevance of such data, and in turn are making that an additional investment. Companies like Twitter, about.me, and Pinterest are just a few properties that offer statistics from a social standpoint, which too can be beneficial to investors. They’re able to gather information on profile visits and user followers, and whether it’s for a company or a personal account, that gives investors and tech firms analytics to determine popularity in the particular market.
While alternative data is a more frequent practice for firms and investors, it still carries a lot of questions and concerns. As it is a newer concept there are few regulations on using web data for investment purposes. However, this is very much a existing source of information for investors and as technology progresses so too will the usage of alternative data in investments. To read more on alternative data visit Matt Turner’s Business Insider article.
from Mark Cohen’s Finance Website http://ift.tt/1HEBFc9
Mark Cohen NYC 