Challenge

 

A contrarian fund looking for turn-around stories with very specific criteria was missing out on too many opportunities.  They needed a more efficient process to find names that matched their philosophy.

EDS Solution

"Better Ideas" 

  • Provided configurable dashboards that integrate the fund's investment philosophy using fundamental metrics, as well as the external data they buy to quickly filter for the ideas they care about

  • Set specific criteria and ranking for beaten down names, forgotten by the Street, with low valuation

  • Enabled alerting to changes in rank

Results​​

  • Doubled the number of ideas in the top of the funnel

  • High percentage of the ideas surfaced by EDS made it into the portfolio - performance also improved

  • No longer reliant on crude, inefficient excel processes

 

Challenge

 

This value fund was getting whipped around

on shorts heading into earnings and closing positions it shouldn't have. The Portfolio Manager (PM) had difficulty monitoring all

the relevant data and expectations 

headed into earnings.   

EDS Solution

"Short-Term Risk"

  • Configurable dashboards that aggregate all relevant data

  • Measures historical correlations to separate the signals from the noise

  • Enabled customizable data inputs (ex.  street ratings, short interest, prime broker data, borrow rates, and call/put implied volatility)

Results

  • Much deeper understanding of how stocks are positioned into earnings

  • Performance has Improved “Since we implemented some quantitative changes, in tracking expectations, we have added 800bps of alpha on the short side”

  • Finding new ideas and trading existing holdings with greater success

 

Challenge

 The Portfolio Manger was looking for a way to size positions based on their divergent views to consensus

EDS Solution

"Our Firm vs. Wall Street"

 

  • Matrix for the PM to dynamically view team's estimates & targets in one module

  • Easily compare metrics to street consensus and rank differences

  • EDS recommends position sizes based on difference to the street and internal intelligence

Results

  • Position sizes now match the firm's variance from the street

  • Vastly increased understanding of company metrics in context of consensus and overall portfolio

  • Fund now measures the impact of their views vs. Wall Street - feedback loop for better decisions

 

Challenge

"Winging it is costing her performance.”  The Portfolio Manager needed a way to solve the 'mental mosaic' problem of juggling several factors for position sizing.

EDS Solution

"Mental Mosaic"

 

  • Simplified an extremely anecdotal and inaccurate process by creating a method to simply self-define and weight all decision factors

  • Produced a quantitative measure of conviction used to haircut or boost position sizes

  • EDS recommends position sizes based on ROI &  internal conviction. Back-testing provides fine tuning of conviction variables

Results

  • Led to more consistent decisions, and measurable performance improvement

  • Made a highly stressful process, more systematic and successful

 

Challenge

The sector Analyst dreaded the time-consuming weekly project of uploading multiple industry data sources to track trends in excel.  She desperately wanted an automated process to monitor real-time trends and be alerted to inflection points.   

EDS Solution

"Automation"

 

  • Visualized all historical data in a real-time dashboard

  • Data analyzed with statistical metrics (z-scores and moving averages)

  • Automated alerting of trend breaks to analyst by email

Results

  • Analyst has more time, better understanding of the industry, and is a smarter investor in the sector

  • She is finding new ideas and trading existing holdings with greater success

 

Challenge

I want to make more money in my highest conviction names.  We use several variables to make investment decisions and size our positions, but I want to know which ones have the most importance.    

EDS Solution

"Position Sizing"

 

  • Uploaded all historical measures of conviction and statistically backtested them to show how much each contributes to daily return

  • Visual dashboard created to illustrate how each factor impacts return

  • Portfolio Manager now has context to improve the conviction equation. Can use AI to change conviction ratings based on historical measures

Results

  • Stronger conviction now aligns with larger positions

  • By tracking all conviction data (catalyst, mgt. team, competitive barriers), the team has a feedback loop to focus their investments in the highest return opportunities

 

Challenge

I am getting hurt in over-owned names, I think? I need to understand how crowded our names are, but also want to use crowding to discover new ideas.

EDS Solution

"Crowding"

 

  • Built a crowding score as a function of 13F filings, short interest trends, borrow rates, & factor measures

  • Combined internal, market and prime brokerage data together in a visual dashboard to highlight names with increased liquidity & volatility risks

  • Utilized crowding risk as an input for position sizing

Results

  • Liquidity risks are now standardized and monitored, as part of the investment process

  • Avoids losses due to misperceptions on liquidity risk

  • Finding new ideas that have helped short performance. 

 

Challenge

I look at many types of companies, and have all sorts of excel based comp sheets - It's a mess. I need a better, more automated way of analyzing what I should pay for a stock.

See what the Industry is saying about EDS

EDS has helped its users identify inefficiencies in the broader universe where, as a starting point, favorable data point to the greatest ROIs on one’s research time - CAIA Article 

EDS Solution

"Valuation Analysis"

  • Created a dynamic comp sheet that performs un-biased valuation analysis across multiple methodologies, in a few clicks.

  • Historical valuation 

  • Existing peers (GICS or Custom)

  • Versus a wider set of companies (cross-sectional - see CFA article)

  • Relative to the any universe  

  • Projected - (ex. should I forecast a multiple re-rating if growth accelerates)

  • Configurable IRR & NEPS Calculations

  • Instant statistical regressions highlight the financial and macro metrics to focus on

  • Adjust filtering parameters for valuation metrics on the fly 

Results

  • Huge Labor Savings   "EDS does many things, but for me, the valuation tools are amazing!  Snapshot on key metrics for any company and its comps.  Saves me hours of work each time I use it." - Fund CIO

  • Price targets are more accurate, as is their conviction in their investment thesis. 

  • Replaced need to edit/update excel based comp sheets on a regular basis

 

Challenge

We are thinking about hiring a data scientist to scale our team? How can I compete against firms with more resources, and be attractive to asset allocators

Check out our video to understand how we can help you..........it is only 3 minutes (and funny)

EDS Solution

"Core Infrastructure"

  • Configurable dashboards that replicate the fund's philosophy across stock selection, portfolio analytics and risk management.

  • Instant valuation & statistical analysis highlights the metrics to focus on, as well as monitoring positions for and expectations or trend changes

  • Institutional grade risk management for stress testing to understand & optimize across multiple themes & factors.

 

  • Dynamic marketing reports that highlight investment style

Results

  • AUM Increased: Investor meetings were much more dynamic, and investors felt more comfortable about the controls in place.

  • Streamlining repetitive tasks led to a substantial increase in high quality positions. "It was like we hired an extra analyst or two" - EDS User

  • Decision-making success improved, as they analyzed past projections in the EDS Data Warehouse

 
Screen Shot 2018-11-12 at 11.02.40 AM.pn

Challenge

Our performance fluctuates in ways I don't understand and it is costing us performance.

I need an easy way optimize any factor, any risk, at any time 

EDS is an Award Winning Risk Solution

Our distinguished panel comprising CEOs, CIOs, and analysts have narrowed down the best portfolio analytics solution providers in the market 

Screen Shot 2018-11-12 at 11.02.40 AM.pn

EDS Solution

"Barra Factor & Exposure Dashboard"

  • Configurable dashboards that dynamically isolate the fund's exposure across multiple factors:

  • Fundamental (Valuation, Profitability, Quality)

  • Sentiment (Momentum, Short Interest, etc.)

  • Growth vs. Value

  • Relative to a customized universe of stocks, sectors or indices

  • Relative to any macro or industry factor

  • Customized risk metrics, including alpha/beta decomposition 

  • Created simulation, stress testing and optimization dashboards for "one-click" portfolio analysis across any factor or position

Results

  • Proactive vs. Reactive: Fund has an immediate understanding of their exposure and drivers of their performance

  • Trading desk is making quicker and better recommendations and decisions

  • Finding new opportunities and uncovering risks that were previously unknown

 

Challenge

 

I have multiple datasets, we pay for, to help our team understand intra-quarter trends. How do we use this data better and in combination with all our other intelligence. Do I need to hire a data team? 

 "EDS’s “quantamental” platform has helped its users identify inefficiencies in the broader universe where, as a starting point, favorable data point to the greatest ROIs on one’s research time."
 
CAIA - Alternative Investment Analyst Review

EDS Solution

"Alternative Data"

  • Provided a platform visualize and test data against over 10,000 global stocks for more efficient use of the data - use the dataset KPI's better. 

  • Aggregate all data sources into one dashboard - clients can use triangulation to take advantage of trends.

  • Data is updated in real-time, inline with investment workflows

  • Incorporated alternative data inline with with investment workflows - KPIs are available inline with portfolio, idea & risk dashboards - data is used more often

 

  • Acted as a data team - helping client analyze the data

Results

  • Improved the Value of the Data to the Entire Investment Team - Data & KPI's were available anytime, anywhere and always updated

  • Expanded the number of stocks that used the alt data for investment analysis

  • Expanded the number of users that took advantage of the data​

  • Team was able to conduct bespoke analysis (dig deeper) on the data

 
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