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  • 22 January 2021

FinScience 2020 Trend Driven Selections performance

FinScience 2020 Trend Driven Selections performance

FinScience 2020 Trend Driven Selections performance 780 438 FinScience

written by Alessio Garzonio

Trend Driven Selection are non-conventional lists of companies  that can be included in new investment products by financial operators or included in investment strategies by investors/traders. 

FinScience leverages AI-based technologies to combine financial data/insights with alternative data in order to create these non-conventional lists of companies.

The main goal of the Trend Driven Selections is to identify “high-growth potential” companies that drive disruptive innovation in industry specific segments (es. Cloud, eCommerce enablers, Medical Technology, Cyber Security, etc..).

These selections go through a proprietary methodology that harnesses, weighs and ranks different standard and non-standards factors.

Trend Driven Selections can:

  • be proposed by the FinScience Team,
  • be developed on-demand around a topic/theme or specific trend requested by the client.

The selection can be focused both on:

  • Macro-economic/financial/market trends ( 5G, Green New Deal, MedTech)
  • Specific events (eg. Covid-19, US Election, etc.) including companies mostly impacted by those events

The Selection of company and a deep dive report is available through FinScience Alternative Data Intelligence Platform where users can capture and measure in real-time alternative digital trends as popularity, users sentiment, weak & hidden signals, go-to-market strategies and financial performances.

In December 2019  FinScience Team published on the platform 3 Trend Driven Selections, namely 5G Impacted Business Selection, Green New Deal Selection and Medical Technology Selection. These Selections were then updated in June 2020 and the next updates will be published in February 2021.

In 2020 FinScience also published two Event-Based Selections namely Coronavirus Safe and Exposed Assets (March 2020) and U.S. Elections Selection (July 2020).

In the next paragraphs some results about these selections and cases on the use of FinScience proprietary indicators to make investments decisions.

  1. Green New Deal Selection
  2. Medical Technology Selection
  3. 5G Impacted Business Selection
  4. Coronavirus Exposed and Safe Assets Selection
  5. U.S. Election Selection

Green New Deal Selection

For the FinScience Green New Deal Selection, we identified the companies that will contribute the most to the transition to 100% renewable energy within 10 years.

The table shows the Selection performance compared with some benchmarks from the date of the first selection (01/12/2019) until 20/01/2021. 

ASSETSReturns for the period*
FinScience Green New Deal Selection+294,00%
Nasdaq Clean Edge Green Energy+272,11%
NASDAQ Composite+54,03%
S&P 500+22,00%

*From 01/12/2019 till 19/01/2021. Returns for a portfolio of stocks equally weighted. No commission fees and dividends reinvestment valuation. Past performance is not a guarantee of future returns.

The FinScience Green New Deal Selection reached an astonishing +294% of returns in the last year. While S&P 500 gained almost 22% in the same period and Nasdaq Composite almost 54%. Even if we look at an industry-specific benchmark such as the Nasdaq Clean Edge Green Energy Index (CEXX) (+272,11%), we discover that our Green New Deal portfolio overperformed it by almost 22% in the period taken into consideration.

Case Enphase Energy

Enphase Energy is a good example of FinScience Data’s predictivity. Indeed, in the last Selection phases (on December 2019 and June 2020) the company was the most rewarded in terms of FinScience Sentiment metrics in the Green New Deal Selection.

This positive attitude towards the company was then confirmed by the financial performance of the company in the next months after the Selection updates. Indeed, the company gained +105% in the period December 2019-June 2020 and +344% in the period June 2020-January 2021, resulting one of the best companies in the Selection.

Alternative Data Intelligence to augment your investment performance

Medical Technology Selection

For the Medical Technology Selection, we identified the companies that are contributing the most to the growth of the MedTech industry, companies involved in developing innovative solutions and services for the health system.

The table shows the financial performance of the Medical Technology Selection compared with some benchmarks from the date of the Selections (02/12/2019) till 19/01/2021.

ASSETSReturns for the period*
FinScience Medical Technology Selection+62,09%
Fidelity Select Medical Technology and Devices Portfolio+30,51%
NASDAQ Composite+54,03%
S&P 500+22,00%

*From 01/12/2019 till 19/01/2021. Returns for a portfolio of stocks equally weighted. No commission fees and dividends reinvestment valuation. Past performance is not a guarantee of future returns.

The FinScience Medical Technology Selection reached +62,09% of returns in the last year. While S&P 500 gained almost 22% in the same period and Nasdaq Composite almost 54%. Even if we look at an industry-specific benchmark such as the Fidelity Select Medical Technology and Devices Portfolio (+30.51%), we discover that our Medical Technology portfolio overperformed it by almost 31% in the period taken into consideration.

 

Case Nanthealth

The value added of the FinScience offering is to constantly monitor the alternative proprietary metrics of the companies selected.

For instance, one of the companies selected in the Medical Technology Selection, Nanthealth, reached a spike in the digital popularity and sentiment trend on 09/12/2020 causing a very intense anomaly detected in the day.

The news that caused these anomalous values concerns some important insights about company products in a vertical financial website and this interest on the company made an impact on the financial market in the next few days. Indeed, the company reached a spike in the volume and price a few days later (11/12/2020).

5G Impacted Business Selection

For the FinScience 5G Impacted Business Selection, proprietary AI algorithms and analysts’ evaluations were employed in order to spot companies that will be positively impacted both in the short and the long term by 5G adoption, as well as companies that will drive this 5G transformation.

The Table shows the financial performance of the 5G Impacted Business Selection compared with some benchmark from the date of the Selections (02/12/2019) till 19/01/2021.

ASSETSReturns for the period*
FinScience 5G Impacted Business Selection+60,93%
Defiance 5G Next Gen Connectivity+44,04%
NASDAQ Composite+54,03%
S&P 500+22,00%

*From 01/12/2019 till 19/01/2021. Returns for a portfolio of stocks equally weighted. No commission fees and dividends reinvestment valuation. Past performance is not a guarantee of future returns.

The FinScience 5G Impacted Business Selection reached +60,93% of returns in the last year. While S&P 500 gained almost 22% in the same period and Nasdaq Composite almost 54%. Even if we look at an industry-specific benchmark such as the Defiance 5G Next Gen Connectivity (+44.04%), we discover that our 5G Impacted Business portfolio overperformed it by almost 16% in the period taken into consideration.

5G sentiment analysis 

To analyze the performance of the 5G Selection it can be useful to look at the sentiment analysis of the 5G topic in the period taken in consideration. Indeed, the positive sentiment trend of 5G has reversed on 4 April 2020 with the lowest value of the entire period (Dec 2019 – Jan 2021) with a daily sentiment of -0.12 due to some conspiracy theories that linked the COVID-19 diffusion and the 5G technologies and spread news that make doubt on the health impact of these innovations. 

This perception slowed the performance of the FinScience selection in April-May, which, however, recovered in subsequent months along with the sentiment associated with the theme.

The FinScience added value is to constantly monitor companies and trends after the Selection, thus allowing them to stay up-to-date regarding sentiment, popularity and other alternative metrics that may impact the financial markets.

Coronavirus Exposed and Safe Assets Selection

The goal of the COVID-19 Safe and Exposed Assets Selections was to identify the companies that would face difficulties as a consequence of the diffusion of the Coronavirus threats and also companies that, for the opposite reason, represented safe assets and an investment opportunity.

The chart and the Table show the financial performance of the Safe and Exposed Asset Selections compared with the S&P500 and the Gold price from the date of the Selections (03/03/2020) till 30/11/2020.

ASSETSReturns for the period
FinScience COVID-19 Safe Assets Selection +159,83%
Nasdaq Composite+40,47%
S&P 500+20,59%
Finscience COVID-19 Exposed Assets Selection+20,53%

*From 03/03/2020 till 30/11/2020. Returns for a portfolio of stocks equally weighted. No commission fees and dividends reinvestment valuation. Past performance is not a guarantee of future returns.

As for the goal of the Selections, FinScience COVID-19 Safe Assets represented a safe investment overperforming the S&P 500 returns by nearly 140% while the COVID-19 Exposed Assets substantially follows the main index.

U.S. Election Selection

The goal of the selections related to the American elections were to identify the companies that were most exposed to Donald Trump’s or Joe Biden’s victory. The companies selected followed the performance of the two presidential candidates with which they were associated. Indeed, during the positive period for Biden’s polls the selection recorded a strongly positive performance while the gap between the two selections were narrowing in the days before the election date due to the increased uncertainty of a clear result.

After the Biden victory consolidation in November 2020 and the democratic victory in the Georgia election (January 2021) that gave to Biden the majority in the Senate  the Democratic Selection outperformed the S&P 500 by more than 110% while Trump’s Selection essentially followed the positive trend of the index.

 

ASSETSReturns for the period*
FinScience Biden Election Safe Assets+129,43%
S&P 500+17.61%
FinScience Trump Re-Election Gainers+22.73%

*From 27/07/2020 till 13/01/2021. Returns for a portfolio of stocks equally weighted. No commission fees and dividends reinvestment valuation. Past performance is not a guarantee of future returns.

FinScience Platform to augment your investment decisions

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