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Alternative Data Council

Founded in January 2019, the Alternative Data Council is series of working groups and information-sharing forums within FISD. It was created as part of the FISD Executive Committee’s strategic initiative to engage the alternative data community. We establish best practices for the delivery of alternative data to the investment industry and provide opportunities for education, information sharing and networking.

The primary goals of establishing voluntary alternative data standards are to:

  1. Lower costs for the benefit of end clients
  2. Facilitate growth of the industry
  3. Drive adoption of alternative data in the investment process
  4. Promote the ethical use of data

Specifically, this will be achieved by:

  1. Improving data documentation
  2. Raising data quality standards
  3. Unifying data pipeline management
  4. Reducing time spent on data delivery and ingestion
  5. Easier permissions management and authentication
  6. Simplifying vendor due diligence and contracting

The industry is best served by having standards which are:

  1. voluntary, open and shared, instead of proprietary and centralized
  2. Community enabled, instead of relying on a single party
  3. Developer friendly, instead of primarily for non-technical users
     
     

From the data consumer perspective:

  1. Investors: reduced cost for investment management services
  2. Fundamental analysts: faster data insights, automate tasks, easier slice+dice
  3. Fundamental portfolio managers: increased idea generation, scalability, data ROI
  4. Quantitative analysts / data scientists: better data quality, easier to assess predictive value and build strategies
  5. Quantitative portfolio managers: reduced research time, increased data ROI
  6. Data engineering: cheaper, faster and better data pipelines
  7. IT: improved security and scalability
  8. Legal & compliance: improved due diligence, faster workflow

From the data consumer perspective:

  1. C suite: happier clients, shorter sales cycle, secure distribution
  2. Product managers: better user experience, usage analytics
  3. Engineering: easier to build data pipelines, less infrastructure to manage

Buy-side institutions with feedback from vendor FISD members. Click here to download a partial list of contributors. If you would like to be involved in future Alternative Data Council activities, contact Tracey Shumpert

  1. Vendor best practices: guiding vendors on how to best deliver data
  2. Vendor questionnaires and contracts: shared semi-standardized due diligence questionnaires and contracts
  3. Documentation standards: consistent data documentation, similar to API Blueprint
  4. Data definition language: covering data schema, file attributes and quality tests, similar to Frictionless, Intake, Quilt
  5. Issue tracker: transparent tracking of problems and improvement requests
  6. Knowledge base: containing answers/solutions (including code) to commonly asked questions/problems
  7. Authentication provider: defining data access permissions and providing authentication

Tracey Shumpert, Vice President, Membership & Programs, FISD

Created by a buy-side led working group representing the breadth of the alternative data industry:

  1. Data Vendor Tear Sheet Introduction and Data Vendor Tear Sheet — Allows data buyers to quickly understand and assess a dataset.
  2. Compliance Due Diligence Questionnaire Including GenerativeAI Questions — Provides a checklist of critical due diligence questions, including GenAI questions
    Compliance Due Diligence Questionnaire — Provides a checklist of critical due diligence questions.
  3. Trial Data Compliance Due Diligence Questionnaire—A shorter checklist appropriate for trial data.
  4. Pre-Initial Meeting Worksheet Introduction and Information Sheet 1.0 — Helps Vendors and Customers prepare for the initial sales discussion.
  5. Web Data Collection Considerations: Introduction — Each topic below outlines issues and recommendations.
    1. Terms of Service (TOS) Considerations
    2. Proxies
    3. Volume Considerations
    4. Robots.txt
    5. Copyright
    6. Privacy
    7. Competition
    8. CAPTCHA
    9. Cease and Desist
  6. A Guide to Alternative Data (Buy-Side Guide)
  7. A Guide to Alternative Data (Buy-Side Guide) Version to Print
  8. Introduction to Trial Agreement
  9. Trial Agreement with MNDA
  10. Best Practice Recommendations on Alternative Data Service Levels, Response Times and Communications Procedures
  11. FISD Data Description Guidelines “DDG” — Helps data vendors apply standard approaches to data documentation. The contents consist of:
    1. A principles overview 
    2. An example of the principles in use with US Patent Data in excel format 
    3. An example of the principles in use with a JSON file. Ask for access.
  12. Alternative Data Identification Factors—An overview of how investment firms determine whether a data set counts as alternative data, and thus whether it is subject to typical alternative data due diligence processes.
  13. Compliance Considerations for Generative AI—An overview of key compliance considerations if your firm uses Generative AI.

New Projects Queue

  • A primer on sourcing data from China
  • An appendix to the existing Due Diligence Questionnaire regarding data sourced from China
  • Industry guidelines to help potential new vendors create a dataset salable to the investment industry
  • [Your project here] Contact Tracey Shumpert if you have an idea
  1. Point in Time
  2. Personally Identifiable Information (PII)
  3. Financial Instrument Identifiers
  4. Data Lineage
  5. Material Nonpublic Information
  1. Invalidity Under The First Amendment Of The Restrictions On Dissemination Of Accurate, Publicly Available Information Contained In The California Consumer Privacy Act of 2018
  2. Response to Interagency Statement on the Use of Alternative Data in Credit Underwriting
  1. Van Buren vs United States
  2. Field v. Google
  3. Sandvig v. Bar Memorandum Opinion13
  4. Midlevelu vs. ACI Information Group aka Newstex
  5. Schrems II overview
  6. City of LA Settles Digital Privacy Lawsuit Against Weather Channel App
  7. Vermont v Clearwater AI
  8. App Annie SEC Ruling

To help with adoption of these voluntary standards, participants benefit from an ecosystem of tools and services that are already compliant with all or portions of them. If you would like to be included in the list, contact Tracey Shumpert:

  1. Eagle Alpha: alternative data platform
  2. Liftr Insights: Hybrid Alternative Data
  3. Neudata: alternative data scouting
  4. M Science: Data driven research & analytics firm
  5. Marbles: library for data unit testing
  6. Sequentum: web data extraction platform

Click here to access the FISD Alternative Data Council Video Library

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