The big case for big dataBY CHLOE WALKER | THURSDAY, 16 JUN 2022 1:58PM
Read more: BlackRock, Charles Wu, Mike Bishopp, Australian Institute of Superannuation Trustees ASI Conference, State Super
Big data should be a natural pathway for the superannuation fund industry, according to investment strategy experts.
A session at the Australian Institute of Superannuation Trustees ASI Conference revealed the many benefits of data backed science and why investment professionals should not overlook it.
State Super chief investment officer Charles Wu said: "In 20 years' time, I don't think any super funds or any fund manager will survive without at least a big data science capability."
Wu added: "When dealing with a problem, innovation is required. When dealing with short term noises, we need to rely on data and not emotions.
"Emotion is natural to human beings but it doesn't help us make investment decisions. This is where data science comes in.
"Data science is our process to ensure that we have the correct insight into the portfolio and remove bias in the process."
BlackRock global co-head of product strategy for systematic active equity Mike Bishopp also commented on the importance of data to unpack the world.
"As the world gets more complicated, it's not a "nice to have" but rather a requirement to understand the complexities of it," he said.
"You need help to leverage machinery, tools and techniques to digest that information to sort of glean the insight from it. That's where big data comes in."
Looking forward, Bishopp said big data will provide humans with the ability to ingest everything.
"[At BlackRock] we want to ingest not tens but hundreds and thousands of data sets every year with a speed that gives us the ability to ram the information advantage associated within portfolios," he said.
"Ultimately, we want to piece together the mosaic of how the world works, which gives us the ability to transition from what I call relatively simple models that are forecasting financial derivatives like earnings and cash flows, to dip down and go into a world where we're counting widgets and are understanding the key drivers to how a company works, how economies work and how the world works.
"If you can do that, then you can bring up the chain of decisions and have an impact at the top of that."
ARDEA INVESTMENT MANAGEMENT PTY LIMITED