Covid-19 shows the value to investors of alternative data
Alternative data can tell in near real time the story of economic and financial market disruption now playing out, but asset managers need artificial intelligence to read it.
At the start of April, Exabel, an artificial intelligence (AI) and machine learning platform for active asset managers, partnered with 1010data, an alternative data provider to the retail, consumer packaged goods and financial services industries, to develop their Covid-19 Impact Dashboard.
The dashboard derives information from multiple sets of live credit and debit card transaction data, as well as some geolocation data that show declining visits to stores.
Taken together, these give investors a close to real-time insight into how the pandemic and lockdowns have impacted consumer spending in the US at companies across 11 subsectors of the travel, general merchandise and grocery, and retail industries.
While sell-side analysts struggle to update projections based on slow-to-arrive and already-out-of-date-when-they-do official and audited numbers, such as GDP and quarterly corporate earnings, the dashboard offers searing insights.
In recent years, the landscape of alternative data has become almost bewildering in its variety, quantity and very wide range of quality. But it can be very valuable
- Neil Chapman, Exabel
Consumer behaviour started to change around February 25 even before the first death in the US.