Incubatee ExtractAlpha is building up a stable base of institutional investor customers including hedge funds, asset managers and sovereign wealth funds.
The independent FinTech and research firm is now in the process of firming up two partnerships which will enable more institutional users to access the products including buy and sell side traders and investors with few resources for quantitative investment strategies. ExtractAlpha’s founding team held senior positions in the original research, development, and sales groups at top quantitative hedge funds including Morgan Stanley PDT and StarMine.
ExtractAlpha builds rigorous quantitative models for institutional investors to gain a measurable advantage over their competitors. The company offers three stock selection models including a tactical trade timing model designed for short-term price changes, a sentiment model “TRESS” that captures, in a structured manner, the sentiment in financial bloggers’ unstructured texts and the Digital Revenue Signal which uses online measures of consumer behaviour to predict companies’ quarterly revenue expectations.
“We help asset managers minimise the risk of entering crowded trades in which too many investors pile into the same trade ideas because their research process is very similar. As a result, we see significant demand for alternative sources of data with provable investment value,” said Vinesh Jha, CEO of the company.
“Cyberport Incubation Programme has been particularly valuable in providing financial assistance on various fronts including marketing and advertising expenditures, corporate services such as legal advice and conference fees. We also particularly like being based in the brand new FinTech Smart-Space,” he added.
An incubatee since August 2015, the company is expected to launch a new model by the end of this year. It is also planning to broaden its global coverage in order to facilitate the needs of more institutional investors.
