Atlanta, Ga.-based decision support analytics provider Lucena Research is integrating additional data into its QuantDesk predictive analytics platform, including sentiment indicators and coverage of global exchanges, to enable customers to make better informed predictions about stock movements.
In November last year, Lucena added cell phone activity levels data from Atlanta-based population-movement intelligence data provider AirSage, in the first of a string of new additions from third party data providers around investor sentiment, consumer sentiment and consumer behavior.
Following a series of testing to determine whether the data sets can be used as predictive indicators, the vendor is now adding consumer and investor sentiment data from social media and newsfeeds to its platform from an unnamed third party source.
Researchers can use the indicators in isolation to predict stock movements or combine them with over 350 other indicators in QuantDesk’s Event Analyzer, which enables customers to create and analyze the impact of technical events, says Lucena co-founder and chief executive Erez Katz.
“Our technology allows you to identify whether the data is predictive on its own merit. Furthermore, we can then assess how the data works in conjunction with our organic set of technical and fundamental indicators. Our platform allows our users to integrate their data with our existing 350 indicators and it became apparent that the news sentiment data source was proven to be extremely beneficial when it is combined with other complimenting factors,” Katz says.
For example, Lucena has identified that investor data on insider buying and selling transactions (i.e. when employees of a company buy or sell stocks in their own company), such as the size of the transaction or the size of the transaction compared to the employee’s paycheck, can be predictive. However, when this data is combined with other indicators such as company earnings and company size, it yields highly predictive metrics, Katz says.
“This gives you a whole a new category of long and short strategies that could be interesting to assess…But without having the technology and expertise, a user will need to acquire a powerful set of hardware, acquire the data and grow a robust team of data scientists with expertise in machine learning technology. We, [on the other hand], have it all ready in one easy to use platform and most importantly at a fraction of the cost,” he adds.
In addition to growing its collection of predictive indicators, Lucena has built out its coverage of exchanges beyond US equities, and is now supporting stocks across all major markets around the globe, including emerging market exchanges, Asia-Pac, Africa and the Middle East, Europe and North America.
The vendor applies currency manipulation to the end-of-day prices, to provide customers who have a multi-currency portfolio with a unified measure, Katz says.
“It’s a big task because there is a lot of data and there are challenges around mergers, survivorship bias, splits, reverse splits and currency exchange, but our data scientists work hard to provide reliable data that is consistent and meaningful to our platform and our users. Our data is the fuel that feeds the engine, without it, our technology will not be able to deliver value to our users,” he adds.
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