Attitudes towards thematic investing are changing. There’s a raft of new expectations for Asset and Wealth Managers – and just as many as new opportunities.
There’s now a pressing need to use unstructured data as a means of unlocking operational efficiency, scalability and thematic depth as a performance driver.
And it’s increasingly what institutional and UHNWIs as investors expect to see from their Asset and Wealth Managers.
Managers need to create more products and customized products faster, and tap into deeper thematic analysis that lets you exploit a theme’s performance potential.
Today, truly understanding thematic exposure at the deepest possible level is key to greater differentiation and performance relative to benchmarks.
And to do that, you need to be able to consistently translate telling market themes and events into actionable investment options and quantified theme exposures.
Today, the Asset and Wealth Managers who win are the ones who uncover more and more nuanced qualitative insights, on repeat.
We’ll explain the state of data and investment strategies today – and what’s preventing Asset Managers from consistently tying these themes into their fundamental data research.
We’ll go through the basics of what we mean by themes and events.
And we’ll look at the new potential that now makes it possible to rope these two worlds together for more coherent insights, more often.
The double-edged data sword
Qualitative data is what gives colour to fundamental analysis. It enriches investors’ understanding of thematic trends and (more often than not) leads to smarter asset allocation and stronger performance.
But the thing that makes qualitative data such a valuable tool for investors is also what makes it so unwieldy.
Countless millions of data points, each with their own individual biases, inaccuracies and idiosyncrasies – and all with the potential to affect institutional investment strategies and asset allocations.
No wonder it’s so hard to make qualitative data usable. Despite being an integral part of modern investing, it’s still incredibly difficult to consistently ingest and score relevant qualitative insights.
And qualitative data is only truly useful to your thematic investment strategy when you know how much value to attribute to it.
That’s tough when you don’t know what you’re going to find, or whether it will mesh with your fundamental data research.
That’s why portfolio managers who can consistently analyze market trends and events and act on them stand to win through Thematic Intelligence: more efficient and explainable thematic investing and more differentiated and customised products.
Send the right signals
Portfolios today can be centred on, well, anything – from ESG to digital healthcare to blockchain.
That’s why today’s investors demand greater transparency, accountability and customisation from their fund managers to maximise potential returns.
Asset Managers need to differentiate better to meet this demand – and thanks to AI fund managers can now develop, research, and create a pool of investments based upon a specific theme at scale.
Millions of events (insights derived from qualitative data) are shaping investment long-term performance and suitability.
And the fund managers with a leading edge are the ones who can distill these events, map them to their investments and calculate their exposure – over and over again. Managers can ask and emphatically answer questions like:
How strongly will a certain event affect this company, industry sector or theme?
How do you identify a company that’s planning to invest in a certain country?
By harnessing specific, relevant events – transactions, announcements, previous connections, properties, labels, attributes, news sources and more – you can start to recognize developing relationships among and between entities to inform your investment strategies.
And the more effectively you can identify and answer these questions, the more transparent, customizable and effective your portfolios become.
An Affinity for Thematic Intelligence
We’re CID. We’ve built a platform that finds, scores and curates the investment themes and events that you care about most.
It’s called Affinity, and it delivers ready-to-bake unstructured data, together with a robust scoring methodology that helps Asset and Wealth Managers mitigate portfolio risk, measure exposure and identify new competitive opportunities.
If you want to turn unstructured data into a tunable, automated, easily usable, measurable resource that enriches your thematic investments, you’re in the right place.