How Hedge Funds Utilize Drones, Satellite Images, And Web Scraping For Competitive Advantage


Last summer a huge hedge fund had a guess, lumber prices were plummeting due to superfluous inventory because of a railway strike. Prior to positioning an enormous short bet that lumber company share prices would plummet, executives at the hedge fund committed the theory by leasing a drone to glide over lumberyards. One of the persons said that one could verbatim observe lumber stocking up everywhere.

The bet was conducive as congenially when lumber deluged the market, slashing the price of the product and lumber companies.

The occurrence is just a solitary example of how hedge funds are attempting to make headway in a developing crowded industry by resorting to optional data. The premature standbys of public economic cadent, earning reports and Securities and Exchange Commission authorizing are being heightened by everything from drone and satellite imagery to abrade the web for real-time car or burrito prices.

Max Wolff an erstwhile hedge fund executive who is now a managing director at Multivariate said that there’s this continuing hunt for contemporary and ideal data sources. The target is to expand the precision of bets and uniformly vitally to make those bets more distinctive than ones being made by the hedge fund next door.

Similar to restaurants hedge funds are under duress to discover components and dishes that make them unique.

Wolff also said that contemplating about substitute data as the farmer’s market for investing. It’s a method of gaining competitive advantage.