Markets are driven by data, but also by emotion, or sentiment. There is an opportunity to identify and act on shifts in sentiment before they are fully reflected in prices. Over the last decade, we have developed systems to understand current sentiment and invest in the opportunities that arise.
Introducing the Quoniam Global Data Sentiment strategy
Quoniam Global Data Sentiment is a liquid long/short strategy that identifies and acts on market-moving shifts in sentiment before they are priced in by analysing unstructured news flow to identify key investment signals.
Alternative alpha
The use of unstructured data to generate signals for a sentiment strategy offers investors the opportunity for alternative alpha: Our strategy aims to identify market sentiment as early and reliably as possible and to use our head start for positioning.
True diversification
By using our proactive sentiment strategy, you can achieve a higher diversification of your portfolio – thanks to low or negative correlations to traditional asset classes and hedge funds.
Capturing insights before the market: What is sentiment and how to leverage it?
- Sentiment captures emotions
Sentiment not only incorporates all available fundamental and technical information, but also reflects emotions such as optimism or pessimism. - Faster to market
Alternative data reflects market sentiment as it happens, allowing earlier positioning in the markets - Signals from noise
Best-in-class global databases and our unique machine learning approach generate a broad range of relevant trading signals in near real time. - Only liquid markets and instruments
Trading only in liquid markets using futures and forwards enables us to achieve a high level of speed and minimise trading costs.
OUR APPROACH
Combining big data portfolio management skills
with best-in-class systematic research
OUR PROCESS
Maximising our information advantage
Capture
- Expert due diligence identifies the most reliable news sources.
- >1 million stories split into >50,000 topics captured every day with sentiment scores assigned.
Refinement
- Proprietary machine learning algorithms filter topics down to 1,000 of potential relevance.
- Quoniam research team assess topics for potential market impact.
- >100 relevant topics converted into investment signals.
Signals
- Systems aggregate signals into country, asset class and currency categories.
- Signal data is smoothed over time to ensure robustness and impact.
Implementation
- Signals are assessed daily and implemented twice weekly to maximise impact/cost benefit.
- Position outcomes are realised rapidly and exited efficiently.
Our edges
Adding value every step of the way
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1. Input
Following extensive due diligence and ongoing analysis, we have selected reliable, comprehensive and insightful data providers of sentiment spanning the globe. We continually monitor other information sources, to identify those that may give us further insights and avoid those that generate noise but no new insight.
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2. Identification
Our specialist researchers and data scientists have identified the news topics most likely to drive market movements.
Our proprietary machine learning system allows us to systematically refine 1 million+ daily news items into actionable long and short signals. We synthesise the published sentiment of market professionals, governments, regulators and other market movers. We capture macro events such as expectations of interest rate movements, trade wars, actual wars and health crises. We capture expert insights on business-related events such as mergers and acquisitions, earnings announcements and other company news.
We get ahead of forecasts, reports and other after-the-fact-data that can take weeks and months to become available. Our systems can cope with the volume, the velocity, the variety and the veracity of news.
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3. Implementation
We implement our positions before sentiment translates into market pricing. We have identified the sweet spot of execution to balance potential return with the trading cost. While traditional investors analyse information, we have already acted. Whether it is a positive or negative position, we have a proven hit rate in getting it right.
Key features
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A low correlation with traditional asset classes and hedge fund strategies. -
A three-year real-money track record for the underlying strategy, supported by simulated data since 2015 showing attractive levels of risk-adjusted absolute performance.
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Investing in the most liquid global equity, bond and currency markets to allow fast implementation of our signals at a low cost.
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MUTUAL FUNDS
Here you can find further information on Quoniam’s approach to “sustainability risks” and “adverse sustainability impacts”.
DISCLAIMER
Detailed product-specific information and notes on opportunities and risks as well as the sales and paying agents can be found in English on union-investment.lu under the heading “Downloads“.
QFS-SICAV (Quoniam Funds Selection SICAV)
Management company: Union Investment Luxembourg S.A.
Portfolio management: Quoniam Asset Management GmbH
Interested?
Get in touch with me.
We would be happy to talk to you about your investment goals and their implementation. Contact me and we will analyse, without obligation, which strategy is the most suitable for you.
Contact
Jorre Willemse
