- With companies revising their forecasts and governments scrambling to put out up-to-date statistics, more investors are turning to alternative data to gauge the impact of the global spread of coronavirus.
- Some of the top datasets identified by BattleFin's Tim Harrington include supply-chain tracking information, social media sentiment analysis, and web-traffic data.
- "Traditional information and data isn't timely enough," said Emmett Kilduff, founder of Eagle Alpha.
- Visit Business Insider's homepage for more stories.
As investors look for a lifeline in what has been a rocky few weeks in the market, many are hoping their saving grace could come in the form of non-traditional datasets.
The novel coronavirus, COVID-19, has thrown global markets into disarray. And with traditional data — like corporate reports and government statistics — being revised or on a time delay, investors are plunging into alternative data streams that can provide them more up-to-date info.
On BattleFin's Ensemble platform, there were 35 data sets related to COVID-19 as of Thursday morning. On Ireland-based Eagle Alpha, there were 49.
"Traditional information and data isn't timely enough," said Emmett Kilduff, founder of Eagle Alpha.
On Eagle Alpha's platform of more than 1,200 alt-data vendors, 59% update daily, Kilduff said. On a call Eagle Alpha held Friday on morning to discuss helpful datasets, Kilduff mentioned that representatives from several central banks had dialed in to see how they could understand the situation on the ground more quickly.
On a webinar on Thursday, BattleFin founder and president Tim Harrington and Ishpreet Pandher, Battlefin's chief strategy officer, highlighted data sets they viewed as being the most useful in determining coronavirus' impact.
"There's obviously a ton of fear and uncertainty out there. One of the things we think this highlights is the need for alternative data," Harrington said. "How can we think about what are the data sets that are going to actually be giving us signals that we're starting to get back into an upswing."
But Kilduff said that the best work data providers are doing is bespoke projects for hedge funds. He said Eagle Alpha is helping with a project to track foot traffic, through cell-phone geolocation data, at Grand Central to see when people return from mandatory work-from-home policies. Other data providers are tracking the companies that are profiting the most off conspiracy theories that now rapidly circulate online everyday.
Here are the 10 alternative data providers highlighted by BattleFin:
Kumi Analytics
Kumi Analytics uses satellite imagery to track and analyze night lights as an early indication of economic momentum. With supply chains being such a focus of investors as the coronavirus spreads, Kumi data could serve to be beneficial to give a sense of where production has slowed or shifted to.
Battlefin's Harrington said one example of the data was how the night-light radiance changed from December 2019 to February 2020 in the northern regions on China while an increase was seen in the southwestern regions, signifying that a ramp up was being conducted in areas not as impacted, Harrington said.
"I think this will be another good example of: how do you see this changing over time, and is this a data set that you can start to see the recovery with," he added.
ClipperData
ClipperData offers a real-time database of worldwide waterborne flows of crude and oil products. It also receives bills of lading from US customs and border patrol agencies, and has export bills since 2014 and import bills since 2009.
If a tanker touches the US, ClipperData can tell you the exact grades and quantities that make up the cargo.
One example of relevant data is jet-fuel offtake, Harrington said. While delivery of jet fuel in Europe has continued to decline, data indicates it has plateaued in China.
Thinknum
Thinknum tracks companies based on information posted online, including jobs, social media, web traffic, product sales, and more.
There's nearly endless amounts of information to scrape from, but one example highlighted by Harrington was data around the impact to movie theaters. Tracking things like status updates, comments and even selfies take are all ways to understand where attendance levels are at, Harrington said.
SimilarWeb
SimilarWeb is a global provider of web traffic, mobile-app engagement, channel sources, keywords, and online conversions with coverage on over 80 million websites and five million apps.
That type of insight is valuable to get a sense of changes in travel, as SimilarWeb can offer a look into activity at hotel chains and and key travel platforms. It's not all bad, though, as entertainment devices and grocery delivery platforms, which will likely see an uptick, can be tracked as well.
"So really trying to look at some of these data sets to balance the positives and the negatives," Harrington said.
Cognovi Labs
In times of pandemics, people are known to react on emotions as opposed to sentiment. Cognovi Labs is built around the idea, quantifying what a consumers intent might be based on analysis of its emotions.
Covering roughly 167 consumer-segment companies, the data lends itself to a long-short strategy, Ishpreet Pandher, Battlefin's chief strategy officer who previously was a managing director at WorldQuant.
"Emotion actually has a big role to play on stock prices," Pandher said.
Pandher said Battlefin is in talks with Cognovi about coming up with a new dashboard to allow you to check coronavirus impact on people based on macro perspective (country, state, county), on different topics, or coronavirus panic scores for different firms.
Mintec Global
Mintec offers global pricing data for roughly 14,000 different food items. The data provider releases 25 million data points each year.
From market impact to price benchmarking and trade and company models, Mintec offers visibility across the global food commodity market, Pandher said.
"A very rich source and it comes at a fast frequency, so you can include it in your models for a market-moving events," he said.
Sentifi
Sometimes, it's good to just cut to the chase. That's what Sentifi does, informing users on what are the most and least impacted firms of each sector.
The immediate birds-eye view of our various industries are doing is useful for investors with less of a quantitative background, Pandher said.
Especially for the discretionary and fundamental guys out there. You need some quick insights. This is a really good product to check out.," he added.
Nikkei
Japan was one of the earliest and hardest-hit countries by the coronavirus, so it would stand to reason that any type of data regarding the country could be beneficial.
Nikkei has insights via point-of-service data. With only a two-day lag, information is fairly relevant and up-to-date.
"For folks who are interested in impact on business and how products are getting impacted in Japan, this is a product that you should definitely check out," Pandher said.
LinkUp
Arguably one of the key indicators of if and when the market will turn will be information on the job market. LinkUp offers insights into job listings.
Millions of job listings are indexed daily from employer websites. Harrington said it will be a key data point to keep an eye on to know when things begin to turn around.
"These typically can be a leading indicator," he said. "This could be something that will start to help people understand if there's a floor."
AlphaSense
It's always helpful to understand what the actual companies themselves are saying in situations like these. AlphaSense tracks earning calls, event transcripts, and company documents.
"Having some sense of what they're saying, understanding what consensus is in the market, and then being able to leverage a platform like AlphaSense, we think is, is key," Harrington said.