Companies that are slow to incorporate alternative data into their research and development (R&D), marketing, investment, risk analysis, and other key processes expose themselves to lost opportunities at best and operational peril at worst.
As one prime example, active investment management firms, including hedge funds and even private equity funds, incur the strategic risk of being outmaneuvered by competitors leveraging alternative data in their securities valuation and trading signal processes. This has emerged as an essential tool for investment management firms seeking market outperformance, known as “alpha.”