Wall Street Letter: Wall Street Horizon Delves Deeper Into Corporate Event Tracking
Tue December 10, 2013
Wall Street Horizon is releasing the second generation of its low latency, corporate event tracking offering in the next few weeks, according to Todd Richman, executive vice president of marketing. The vendor provides data management for corporate events surrounding earnings calls and derivatives.
The real-time dividend announcement monitor (RDM) and the earnings date monitor (EDM), both of which cover single-stock events for options and stock traders, will include data such as a company announcing an earnings call date or an upcoming corporate announcement, data which end users can use to preemptively organize their strategies around the volatility surrounding these "tremors," as Richman refers to them.
"When info comes out about an upcoming event this is the tremor. People care about tremors because traders want advance notice on events and use it to feed into trading models," said Richman.
Richman said end users of the offerings utilize this data to optimize their strategy revolving around the volatility that comes with corporate events and other announcements.
"There are people who trade offensively by taking advantage of upcoming volatility and trade on it, so they need to know when it is coming," said Richman. "There are also defensive models on where the disruptive nature of volatility causes prices bubble up before, during, and after an event so the offerings allow them to reduce exposure to volatility."
This data is collected by analyst at WSH who reach out over 50,000 times throughout a quarter to collect info that isn't press released and is either posted to a company website, put through a wire service, or is word of mouth that has to be confirmed, according to Richman.
Garnering this data allowed WSH to amass a large historical database of financial information, which is enticing to traders with quantitative, algorithmic, and high-frequency strategies, according to Richman.
"The logical next step for us was to give this to our quant clients as they take events and timestamps we provide to gauge what the market did in terms of pricing, volume, volatility, and other events derived from this," said Richman.