- Hedge funds are constantly searching for data sets to give them an edge over their peers.
- The alt-data firm BattleFin shared a list of the most plugged-in data providers for the Russian war.
- Funds are tracking commodities, supply-chain issues, political sentiment, and more.
Markets have been volatile since Russia decided to invade Ukraine, but top investors have a plethora of wonky data sets to tap into to give them an upper hand.
Compared to years past, the challenge for savvy investors now is not finding unique data sets but determining which ones are worth the time and money. Actionable insights can be few and far between in the still nascent alternative-data space, especially for specific market events.
Hedge funds and other investment managers turn to alternative-data marketplaces, such as BattleFin, that constantly vet new data vendors to connect them to promising providers, including commodity trackers, eagle eyes watching the supply chain, and geopolitical consultants.
BattleFin shared a list of some of its most plugged-in providers that its clients — which range from hedge funds to large corporations to governments — are using to understand the Russia-Ukraine conflict.
1. EOS Data Analytics
An artificial-intelligence-powered satellite-imagery company, EOS Data Analytics combines alternative data’s biggest buzzwords into a single firm. The company, in Menlo Park, California, is working with Ukraine’s defense forces and humanitarian organizations as it analyzes satellite pictures of Russia’s military and its movements.
“In the context of military aggression Ukraine is undergoing, all company’s specialists — developers, scientists, and R&D department — act as one closely knit team. We’ve even arranged night shifts to stay connected 24/7” with Ukrainian leaders, said Aleksey Kryvobok, the chief science officer at the firm, in a statement.
2. Auquan
Auquan’s tool, the portfolio activity monitor, is one way hedge funds are keeping an eye on potential ripple effects that affect their holdings.
Even though some companies are not directly affected, shocks to the supply chain and global labor force caused by the conflict can have second- and third-order effects on even the most domestic-focused companies.
Auquan’s platform tracks the effects of sanctions and corporate exits as it relates to individual stocks in investors’ portfolios, ranging from defense contractors’ potential profits to shipping line interruptions to manufacturing changes.
Immediate effects are also monitored, such as the decision by McDonald’s to pull its restaurants out of Russia.
3. Morning Consult
Knowing where the ball is heading is a major part of investing, and when government decisions swing markets rapidly, it’s good to know what its constituents are thinking. Morning Consult began a poll on February 25 to track the global sentiment surrounding the invasion of Ukraine.
The company said use cases for this data included forecasting possible moves by the US and European Union, as well as how economic effects from the conflict are being received by the general population.
4. EPFR
The British data provider Informa’s EPFR tracks fund flows into global mutual funds and exchange-traded funds, providing users of the data insight into where investors are moving their money. When the conflict began, money invested in Russia-related funds was quickly withdrawn, and where it lands is an important data point for investors to keep an eye on.
The company told Insider that when Russia invaded neighbors in the past, such as its 2008 invasion of Georgia, money fled from Russia-connected mutual funds and ETFs. But once that conflict ended, investors were quick to pile back into the country.
5. RIWI
A global sentiment tracker started at the University of Toronto's Massey College, RIWI is monitoring Russia's invasion of Ukraine with its Military Conflict Risk Index. The index measures "the collective perceptions of military conflict intensification from citizens in five major geopolitical conflict regions."
For users of this data set, it provides a look into the ground support for any conflict and also tracks migration patterns in real time.
"It is specifically designed to meet the urgent need to understand the dramatic escalation of conflicts and confrontations both within and between countries," said Greg Wong, RIWI's CEO, in a statement.
6. Tidal Markets
Short-seller data has proved to be incredibly valuable for hedge funds, as they try to protect themselves from becoming a victim of a Reddit-driven trading frenzy that caught mangers such as Melvin Capital and D1 Capital Partners in early 2021.
Tidal Markets doesn't track short-sellers directly, but instead the securities lending market where short-sellers borrow their shares to make their bets against their targets. Tidal Markets uses that data to judge the volatility in domestic stock markets around the world, letting forecasters track the stability of a possible foreign investment.
For example, Russian TV and internet companies were incredibly volatile at the end of last year, Tidal Markets' data indicated, foretelling a rocky start to the year for the entire country's equity market.
7. Dataprovider.com
A data company with use cases for investors and corporate brand managers, Dataprovider.com has taken its web-tracking approach to Russia. The firm has info on Russian domain names, technologies used by those domains, and their current operating status thanks to more than 200 different data points.
The firm said it could provide a snapshot of how the Russian digital economy — everything from e-commerce to social-media companies — handled the conflict.
8. Kpler
Kpler, which was founded in Paris in 2014, has become one of the most well-known commodity and supply-chain trackers.
The firm's data includes real-time updates on freights of oil, natural gas, chemicals, and coal. One of the biggest economic effects from the conflict so far has been on the energy market, with gas prices soaring in the US and Europe.
9. Six
The global data provider Six has seen increased interest in its Sanctioned Securities Monitoring Service, which tracks the different sanctions placed on companies and countries so that compliance departments don't always have to stay on top of the latest geopolitical news.
The tool would also point out securities indirectly affected by sanctions, such as providers to a now blocked company.
10. Techsalerator
Founded in 2020, Techsalerator was originally built to track COVID's effect on different businesses. Using hundreds of millions of data points on businesses, their employees, and their consumers, Techsalerator now tracks how Russian businesses are fairing during the conflict and aggressive sanctions from the US and Europe.
The young data provider said its feed updated weekly and provided insight across Russia's business environment.