Is Quasi-MNPI The Ultimate Alpha Generator For Public Equities?
It seems like a lot of HFs across the stack of L/S, Quant, L/O and SM/MM seem to have an unusual focus on financial modelling and quantitatively synthesizing data using methods such as linear regressions and whatnot (I'm not a STEM major) versus just getting quasi-MNPI from human sources, which is much easier and cheaper than quant algorithms and data scraping and cleaning.
What I mean by quasi-MNPI is basically using information from not-so-easily-accessible sources, think satellite photos, although that's old-school and obsolete now.
Here are a few examples I can think of the top of my head
- If you're a marquee platform with access to management, keep prodding them on a regular basis until they divulge quasi-MNPI to you. For instance, text the CFO on a weekly basis "so how's this quarter shaping up?" until he basically spills the beans
- If you're covering Disney, instance, hit up your college roommate's buddy who's a data scientist at Uber and ask him about the latest activity levels and trends in rides around the Orlando areas
- If you're covering Carnival Cruises, have a couple contractors posted at Cape Canaveral and Nassau counting the number of passengers who walk on/off every single cruise ship equipped with binoculars, pen and paper
- If you're covering Walmart, have a buddy who's in IT at Hasbro's straight up send you screenshots of their orders from Walmart this fiscal quarter
- If you're covering P&G, slip someone who works at Cincinnati's private airfield 200K to send you a photocopy of P&G's corporate jets charters and flight logs, especially if the CFO or Head of CorpDev is onboard
- If you're covering Tesla, have dock workers in a port in Shanghai email you the number of Tesla shipments (by TEUs or weight) heading across the Pacific each week
Note that I'm unsure of the legality of what I just mentioned above as I don't come from a law background, but they all seem like highly legitimate ways to generate alpha and triangulate accurate earnings predictions from diversified and uncorrelated data sources.
Additionally, there's really a huge amount of underpaid middle management employees at each company who would likely jump at the chance to give you actionable MNPI for a 50K one-time cheque.
[Comment redacted by Compliance]
Region checks out
I think it's because I mentioned Shanghai
+ bump
Mgmt access especially from shorter term investors definitely quasi cross MNPI sometimes depending on the company (“street models eps down QQ, usually it’s up in Q2. thoughts?”). Other stuff haven’t heads as much
+ bump
My favorite part is when he suggested texting the CFO the same thing repeatedly was an actual strategy that could yield any positive results
Give all these a shot OP, come back and tell us how much alpha you generated but be sure to factor in the cost of set up
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