“Unstructured data” refers to data that are often text-based (as opposed to numeric), and have no data model. The information contained in this type of data can lead to significant business and financial intelligence, or ‘sentiment indicators’.
Since 2007, we have developed and patented natural language (NLP) algorithmic approaches to uncover risk and opportunity in private and public assets. Using unstructured data from social networks and other publicly available resources, and the context of industry value chains, our algorithms quantitatively profile investment or water risk.
The analysis is typically conducted in two stages:
- A data clustering approach based on semantic tags (e.g. value chain, partnership, scaling), and
- Computational business intelligence (market, team, industry) using the data metaclusters as objects.
Business Risk Profiling. Drawing from research on strategy, marketing models, and business valuation tools, the KeyStone Compact® risk model analyzes the company through two lenses: Strength of industry value chain position; and Investment grade.
- The Industry view considers how the company is positioned in terms of its leverage, dependencies, team and intellectual assets
- The Investor view considers the upside potential and time to scale given its industry value chain position and capabilities to overcome the dependencies and access to markets
Water Risk Pricing in Securities. Since 2013, we have developed, built and tested extensions of the capital asset pricing model (CAPM) to uncover excess volatility risk in stocks from exposure to water and weather risks. The waterBeta model prices water risk relative to industry-specific benchmarks and takes into account intangible information from unstructured data. waterBeta’s are used in the LimeYard-TSC Water Risk Index family published on Bloomberg.
Recent Students and Collaborators
- Mingyan Tian, PhD student, Civil and Environmental Engineering;
- Nicole Bette, MSc, Biomedical Engineering;
- Kavya Vayyasi, MSc, Electrical Engineering and Computer Science;
- Nic Miller, BSE, Civil and Environmental Engineering;
- Sven Adriaens, BBA, Finance, Michigan State University
- Alex Mercier, MSc (EWRE), IT and Cyber Security management Consultant at Wavestone, UK;
- Antti Tahvanainen, PhD, Research Institute of the Finnish Economy, Helsinki, Finland;
- Tim Faley, Professor and Sokoloff Chair of Entrepreneurship, University of the Virgin Islands;
- David Brophy, Professor, Ross School of Business.