Even though Hedge Funds have pioneered the use of Alternative Data and found creative applications to the investment process, there are still several stubborn misconceptions even among sophisticated investors. Some of these are harmless while others may hold investors back from using Alpha-generative data to their (and their LP’s) benefit. One such myth is the belief that Alternative Data is only applicable to B2C names, or companies that market and sell directly to consumers. This thinking leaves a large portion of the portfolio without AltData coverage. Indeed, in the case of multi-manager platforms, this approach may leave whole pods without access to value-additive data that can provide an edge in today’s Alpha-hungry market. In most cases, Alternative Data coverage, or the portion of the portfolio covered by AltData, remains relatively low.

This should not be the case and investors are learning that Alternative Data can inform company KPIs across most GICS sectors.

Take B2B Software, for instance. Salesforce (CRM), Hubspot (HUBS), and Adobe software (ADBE) cater to some of the most critical business functions for small and large businesses. For some of these companies, spending data can be informative, but other datasets can be even more insightful. Maiden Century works with data partners who collect data on headcounts and hiring trends within these and other companies. The insights investors gather can be very granular and very indicative. This data allows investors to see if and how much the R&D and sales departments are growing within each company and even if the sales employees are hitting their annual targets. To learn more about this data contact us and we will give you a sense of how you can leverage this data.

Companies like Palantir (PLTR) are heavily dependent on large government contracts as over half of their revenues come from government agencies. Investors can tap data from vendors tracking public filings to analyze new contracts and estimate revenue growth.

Heavy machinery manufacturers such as Caterpillar (CAT) and Deere (DE) also provide equipment to various US state agencies who are obligated to file forms when financing agriculture and construction equipment- those forms can be scrubbed, aggregated, and productized into consumable insight via the Maiden Century IDEA platform. If you’d like to learn more about these data vendors, reach out.

If you’d like to increase your data coverage and see how Alternative Data can help you cover names you didn’t think possible, reach out.  We’d love to hear from you.