Quant Hedge Funds Buying Data at Dizzying Pace

hedge funds

Data, get your Red Hot Data data here. A long, long time ago, every corner in NY and Chicago had newsstands hawking the latest news of the day. Now, getting news and comments (data, and as much as possible) fed into the quantitative and AI programs hedge funds are increasingly using is extremely HOT. This is the hottest sector in finance right now and, lets be real, is making human traders obsolete. So, if you have a program that can tell if a CFO’s eyebrow twitches forecasting earnings………call me. Big bucks for that twitch.
(Bill Taylor/CEO)

“Kumesh Aroomoogan has come a long way from his days at Wall Street bank Citigroup, where his job was to stay on top of breaking news. He remembers getting yelled at by a trader because he stopped watching news feeds to go the bathroom and missed a market-moving headline. Now, he’s the co-founder and CEO of Accern, a company that automates his old job.

Tedious office roles are increasingly done by computers, freeing up workers to do things that are (hopefully) more useful. To some extent, even the trader who once yelled at Aroomoogan has been automated: One of the hottest areas of finance these days is quantitative investing, which uses artificial intelligence to sift through massive troves of data to identify signals that humans can’t see. Quant funds are Accern’s biggest customers.

Aroomoogan’s bathroom-break schedule is less fraught now, because instead of supplying a human trader with tips about breaking news, Accern’s technology sweeps up data from 300 million websites, 150 million Twitter feeds, as well as analyst presentations and FactSet reports for traders—either humans or algorithms—to analyze. It uses natural-language processing to find keywords like company names, and measures when a story is rising up the media food chain, such as from blogs to newswires, to indicate that it may be important enough to act on…”

Selling data to feed hedge fund computers is one of the hottest areas of finance right now