Rethinking Alternative Data in Institutional Investment

29 Pages Posted: 20 Jun 2018  

Ashby H. B. Monk

Stanford University - Global Projects Center

Marcel Prins

APG Asset Management

Dane Rook

Stanford University

Date Written: June 11, 2018

Abstract

As alternative data steadily become mainstream in finance, institutional investors may benefit from rethinking how they engage with alternative datasets. Specifically, they could gain from rethinking 1) alternative data’s value proposition, 2) how they characterize alternative data, and 3) how they access alternative data. Rethinking their approaches to alternative data in these ways can help Investors select alternative datasets that better align with their organizational resources and contexts. We argue that such rethinking offers the largest advantages when it focuses on building defensive and defensible strategies around alternative data, rather than prioritizing quicker exploitation of short-lived opportunities. Rethinking alternative data will require institutional investors to investigate new partnering possibilities, which should help them weather (and even thrive during) the escalating arms race among financial-market participants for alternative data. Building capacity for alternative data in these ways could also help Investors accelerate innovation.

Keywords: alternative data, institutional investment, market competition, organizational strategy

Suggested Citation

Monk, Ashby H. B. and Prins, Marcel and Rook, Dane, Rethinking Alternative Data in Institutional Investment (June 11, 2018). Available at SSRN: https://ssrn.com/abstract=3193805 or http://dx.doi.org/10.2139/ssrn.3193805

Ashby H. B. Monk

Stanford University - Global Projects Center ( email )

United States

Marcel Prins

APG Asset Management ( email )

Gustav Mahlerplein 3
Amsterdam, 1082 MS
Netherlands

Dane Rook (Contact Author)

Stanford University ( email )

Stanford, CA 94305
United States

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