Technology provider Refinitiv has announced the findings of its ‘A New Dimension of Data – Building an Open and Trustworthy Alternative Data Ecosystem’ report in collaboration with Open Data Institute (ODI).
The release of the alternative data report comes at a time when our world is challenged with understanding the enormity of available data and information, Refinitv says.
“Investment managers, traders and investors are tasked with finding the right data, making sense of it, and ultimately actioning it. Unstructured information, the explosion of alternative data, and the need for trusted sources makes an already daunting task even more complex,” the firm writes.
According to the report, which looked at over a thousand purported alt data sources, hundreds of case studies, and millions in global spend, the alternative data sector seems to be gaining traction.
It also says that while the governance and norms for the licensing and distribution of traditional data are well established in many countries, the alternative data market is at an early stage. Best practices, codes of practice, regulations, and standards have not yet been fully established.
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Refinitiv’s report explains that building an open and trustworthy alternative data ecosystem requires providers to document data sets, including key metadata standards.
It also asks them to describe the quality, coverage, and known limitations of a data set and to represent basic data types, dates, and use of common data formats.
Providers need to identify entities such as organizations, geographic areas, products.
Additionally, they are required to develop codes of practice and technical methods for Web scraping and other forms of data collection.
“At Refinitiv, we believe that alternative data ought to be standardized and where possible, normalized in order to improve data quality and reliability to better serve clients with the highest ethical and legal considerations,” said Austin Burkett, Global Head of Quants and Feeds at Refinitiv.
“In order to build an open and trustworthy alternative data ecosystem the ethical, technical and practical issues need to be addressed. We have found that the ecosystem is struggling from a lack of standards and transparency, creating issues around privacy, intellectual property, and trust,” Jeni Tennison, CEO of the ODI, said.