Exabel: Hedge funds are increasingly using alternative data

Exabel: Hedge funds are increasingly using alternative data

12 februari 2025

Hedgefondsen Technologie
Technologie (01) technology

Hedge funds and other investment managers plan to further increase their use of alternative data for research and insights with geolocation and consumer spending data expected to see the biggest growth in demand, new research from leading alternative data platform Exabel and BattleFin shows.

The global study with investment managers and analysts working for fund management firms with total assets under management of $820 billion, found 86% expect to increase their use of alternative datasets over the next two years. All categories of data will see growing demand with 51% expecting dramatic increases in usage for geolocation data over the next three years and 50% dramatic increases in use of consumer spending data.

Exabel’s research report Alternative Data Buy-side Insights & Trends 2025 found all the managers and analysts questioned in the US, UK, Singapore and Hong Kong currently use alternative data in some form. Almost all (98%) agree that traditional data and official figures are becoming too slow in reflecting changes in economic activity.

Consumer spending datasets are seen as the most likely to provide an outsized informational edge in the near future, the study found. Around 75% questioned chose consumer spending data compared with 50% choosing Natural Language Processing (NLP) and sentiment while 45% selected social listening and 43% chose employment and people moves data. Just 7% selected satellite data.

The study found investment managers and analysts have built up experience using alternative data with 61% questioned saying they began using it three to five years ago, while nearly one in ten (9%) did so more than five years ago. Around 28% started using it a year to three years ago. Their experience of using it has been generally positive with 87% saying the process of using alternative data is good or excellent.

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