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Theme that emerged from this weeks reading is the importance of data quality.
QUOTES
“Data is becoming way more important to drive investment decisions”
Bill Dague of NASDAQ Data Link Head of Alternative Data
News Articles
Podcasts
Cool Charts
Final Thoughts (2022 Books)
Appendix
#1 – Thomas Redman of Data Quality Solutions published in Harvard Business Review Bad Data is Sapping Your Team’s Productivity. December 2022.
My Take: “Bad data hammers productivity”. New technology should enhance productivity, data is having the opposite effect! Data management has not kept pace with the new tech that is driven by data. The author introduced me to the “Rule of 10”, which states that it costs 10x as much to complete a unit of work when the data is flawed. So make sure your data is not flawed. Companies should turn their focus toward data quality. How to raise the bar? The second key takeaway is that, often times, small data is better than big data. The main question to answer is, is this data a fit for it’s intended use? More is not always better.
#2 – Chris Katje of Benzinga published 'Data Is Becoming Way More Important To Drive Investment Decisions,' Say Nasdaq & iShares Execs On Data Use. December 2022.
My Take: The firms cited (NASDAQ & iShares) are both data owning firms with broad distribution. The focus of this short article is the rise of retail investors wanting more tools, like new, different, better sources of data. I am a bit skeptical of the broad application of new data sources with retail investors until it becomes much easier to engage with high quality, trustworthy data. Both of these firms have the reach to make it broad data access happen as the tools improve.
#3 – Bloomberg Law published SEC Must Set Due Diligence Standards for Use of Alternative Data. December 2022.
My Take: Clear regulatory guidelines will help advance the alternative data space. This article suggests the largest firms are setting the standard, perhaps to the detriment of smaller, less resourced firms. A better course of action would be to have the SEC lead the way, rather than the large firms, to set clear standards for the use of alternative data. The goal should be to broaden the access to new data for making investment decisions (see above article).
BONUS: LSEG and Microsoft launch 10-year strategic partnership for next-generation data and analytics and cloud infrastructure solutions. December 2022.
“…the deal significantly advances LSEG’s strategy of building an efficient and scalable platform for its Data & Analytics business to deliver next-generation services for a range of customers across the financial markets value chain through improved workflow and greater flexibility.” MSFT aligns with data owner…highlighting the importance of owning first party data.
BONUS 2: Michael Thrasher of Pensions & Investment published Alternative data use surges at PE and venture capital firms. December 2022. This short article cites the recently published Lowenstein Report.
#1 – The Data Stack Podcast interviews Ashwin Kamath of Spectre. November 2022.
My Take: Ashwin Kamath started Spectre to allow data using firms to focus on analysis rather than the operational issues that come with data ingestion & data processing. This is a wide-ranging episode, most interesting to me was the importance of data management.
Highlights (55-minute run time):
Minute 02:30 – interview starts & Ashwin’s background (Affirm, Two Sigma)
Minute 05:30 – infrastructure needed to approve loans quickly while at affirm
Minute 07:30 – landscape of working with data in finance (importance of data quality)
Minute 15:00 – in finance every company does it a little differently; Spectre allows you to focus on analysis rather than the operational issues.
Minute 17:30 – the challenge and opportunity with 3rd party data
Minute 32:00 – the opportunity to start Spectre & motivation
Minute 38:30 – issue of data decay & issue resolution
Minute 42:30 – advice on setting up data quality system (start from beginning)
Minute 49:00 – setting up network that only runs of data is high quality
Source: SigTech’s annual Institutional Investor Report.
These are the results of SigTech’s survey of 119 institutional investors from around the globe.
Of most interest to me was the question of increasing budgets and the need for high quality data going forward.
BONUS: Arnab Bose & Aditya Aggarwal of Abzooba published Data Validation and Data Verification – From Dictionary to Machine Learning. December 2022.
Books read in 2022 (so far).
FICTION
The Nineties, by Chuck Klosterman
Probably my favorite “cultural observer” author. We are the same age and he writes about a lot of the pop culture happenings of my formative years.
Cannery Row, by John Steinbeck
One of my favorite authors.
Sweet, Sweet Revenge, by Jonas Jonasson
Newer book by an author I like.
Citizen Vince, by Jess Walter
Older book by an author I like.
NON-FICTION
Thinking in Bets, by Annie Duke
Interesting way of thinking about decision-making from a professional poker player. You don’t ever have all the information you need. How do you increase you odds of making a good decision?
Creativity: A Short & Cheerful Guide, by John Cleese
A funny book written by a funny man. I tend to think about people like John Cleese as a “natural” and think it must be easy for him to be humorous. This is not the case. He has a process.
The Boys in the Boat: Nine Americans and Their Epic Quest for Gold at the 1936 Berlin Olympics, by Daniel James Brown
Inspired by my daughters rowing at Magnificat High School.
Keep Going: 10 Ways to Stay Creative in Good Times & Bad, by Austin Kleon
This author has written a number of short, insightful books.
Genghis Khan, Making of the Modern World, by Jack Weatherford
Found this interesting. Genghis Khan had a BIG impact on the history of the world. Despite this, he is not written about all that much, largely because he was based in Mongolia and not Europe (I learned about the Baljuna Covenant, maybe one of the more important events in history that remains unknown).
Masterpiece: The Emotional Journey to Creating Anything Great...Anything by Dean Stoecker
I have really enjoyed getting to know Dean over the past year or two.
The Data Detective, by Tim Harford
Trying to read about data and being a data practitioner.
The Daily Stoic, Ryan Holiday
A daily devotional that shares insights about life from the stoics. I find it interesting that these men (and it is only men apparently) dealt with largely the same issues we deal with today, 2,000 years later.