Why alt data is better for short-term investment forecasting
Internet data continues its rapid pace of growth as more users come online to conduct business transactions, upload personal information, and track economic activity. According to a Statista report, the total amount of data created, captured, copied, and consumed reached 64.2 zettabytes (64.2 trillion gigabytes) in 2020 and is projected to more than triple to 180 zettabytes by 2025.
E-commerce activity, financial and economic reports, satellite images, and other information pertaining to investment valuations make up a large portion of this data. Portfolio managers looking to beat the market have taken advantage of this information when making portfolio decisions, giving rise to the term "alternative data" to describe these new sources of investment intelligence.