Decoding Sentiment: How we generate alpha

Investing in a portfolio of stocks that go on to beat Wall Street expectations, at a rate higher than market average, has historically generated superior returns

Improve your stock returns by uncovering companies with Revenue upside

Accurately estimating earnings growth into the future is the name of the game in stock picking. Wall Street analysts continue to drive the market's expectations of a company's forward earnings potential, and that in turn drives its stock price.

At Alpha DNA, the investment science of building stock portfolios with smarter estimates is transformative:

  • We access alternative data that insightfully augments traditional financial information
  • We deploy machine learning to discover alpha-generating patterns within the data

Our core research is focused on decoding sentiment as a proxy for tailwinds in customer demand and identifying the companies most likely to be rewarded for that improving sentiment.

Simply put, we try to be a few steps ahead of the ‘average’ analyst estimate. And that delivers the alpha in our equity portfolios, consistently.

View our source of alpha

Avoiding Big Losses: How we hedge your downside

We offer all of our strategies in a hedged and unhedged version. You can customize the risk profile for your clients.

Building a resilient portfolio.

In risk management, true north is deploying hedges. Hedges can produce effective downside protection from market declines.

We manage hedges deploying options in your portfolio thru a Target Delta Hedging Program. This is just a technical way of saying that we manage the hedges so you always have an appropriate amount of protection.

Buying hedges for your portfolio is similar to purchasing homeowner’s insurance. You pay a regular premium for home insurance that reflects the risk profile for your home such as risk of wild fires, lack of fire stations, or location in a flood zone. Similarly, hedging costs reflect the fluctuating risk profile of your equity portfolio based on changing market conditions such as increased volatility.

We manage the cost of these hedges to make sure you have the most optimal hedging program. You don't need to be an options expert to understand what we build in your client's portfolio. We play the role of options expert for you.

But for the client with a higher risk tolerance, you can elect to skip the hedge and we will implement an equity only portfolio with no options hedges. You can mix your allocation to hedged and un-hedged strategies to achieve the right risk tolerance for every client. 

Learn more about hedging