Hands-On Machine Learning for Algorithmic Trading

Sources of alternative data

Alternative datasets are generated by many sources but can be classified at a high-level as predominantly produced by:

• Individuals who post on social media, review products, or use search engines
• Businesses that record commercial transactions, in particular, credit card payments, or capture supply-chain activity as intermediaries
• Sensors that, among many other things, capture economic activity through images such as satellites or security cameras, or through movement patterns such as cell phone towers

The nature of alternative data continues to evolve rapidly as new data sources become available while sources previously labeled alternative become part of the mainstream. The Baltic Dry Index (BDI), for instance, ...