May 21, 2009 · Guns
Users of Gridstone’s platform will become familiar with Gridstone’s unique search tool, which allows them to search through a company’s SEC filings and conference call transcripts. Based on feedback that we have received we’ve heard that people like the fact that the search engine returns just the exact “snippet” that references their search term, is able to understand their search term and provide results that are richer than a straightforward keyword search and finally, allows them to narrow or broaden their search results at the click of a mouse.
In an effort to provide this useful tool to a larger community, we recently exposed our search engine outside the password-protected firewall. This can be accessed at http://search.gridstoneresearch.com.
While this is in beta, we have been introducing new and interesting features to this already unique search engine. For example, today we’ve introduced a feature that shows a tag cloud of the tickers that matched a user’s search term. This visual presentation provides a very intuitive view into the distribution of commentary between various companies.
For example, to see who was really impacted by the war in Iraq, I ran a search for “Iraq”, filtered my results to exclude 10-Ks/Qs (a lot of companies list Iraq in their risk factors) and got this tag cloud as a result. The Government services companies (KBR, MANT, HRS, LLL, LMT, etc.) were the obvious candidates for such a search, but I was surprised to see companies like OSK and RDY in the mix. Another useful way in which one can see what’s impacting various companies.
March 9, 2009 · Guns
We would like to announce that the Board of Directors of Gridstone appointed me to take over the responsibilities of CEO of Gridstone from Basab Pradhan, my co-founder and colleague. Basab continues to be closely associated with the company as a Member of the Board. (You can find Basab’s post on his blog about his future plans here.)
I co-founded Gridstone 3 ½ years ago, and have spent most of that time building out our product platform. To spearhead our market development efforts, I recently relocated from the San Francisco Bay Area to New York, where a majority of our customers are.
With the support of a few key strategic customers, we have spent the last 3 ½ years building a unique and valuable set of capabilities along many different dimensions. While that process is never complete, we have reached a point where the time has come to aggressively take these to market – by ourselves and more importantly, with partners. That is going to be our focus going forward – to expand our relationships with our current customers by anticipating and serving their research and data needs better, working with partners to penetrate the market, and leverage our capabilities in new and exciting areas.
I thank you for your support thus far, and look forward to your continued inputs and suggestions as we enter an exciting new phase of growth.
PR Ganapathy
January 27, 2009 · Basab Pradhan
There’s a Vanguard ad running in the print media that I quite like. It visually makes the point very eloquently that management fees matter. With the market performance of last year, Vanguard probably thinks that the iron is hot for passively managed funds to strike and gain dominance. I wrote about this shift in my last post.
Investment costs are becoming important in the hedge fund industry too. With uncertain markets and lower leverage to goose the returns, LPs are asking tough questions about the 2/20 hedge fund economics. Mutual funds may not have to change their economics but few have been spared the twin blows of declining prices and redemptions.
Our message to the asset management industry is not very far from what’s depicted in the picture above. “Investment Research Costs Count.” is what we would have said. But that’s not all. Relying on a technology enabled service for Research Data Analytics relieves your analysts from the tedium of pulling data from filings to assemble a spreadsheet. And the final outcome is higher quality, auditable and with a faster turnaround time.
Better, Cheaper, Faster. That’s us. Talk to us.
January 26, 2009 · Basab Pradhan
Suzanne Duncan of IBM, in a recent conference predicted that institutional assets will shift over the next decade from 90% actively managed to 90% passively managed [via Integrity Research].
There is no question in my mind that the share of equity assets will shift towards passively managed funds. But I can’t agree that the shift will be as dramatic as that. Passive and actively managed strategies don’t just compete with each other for market share. They also affect each other’s success. Here’s how.
A market that is dominated by active strategies, makes it very difficult for these competing active strategies to make money, especially compared to the broad market. In such a market, the lower costs of passively managed funds can make them attractive. That’s the kind of market we have right now.
On the other hand if we have a market where passive investing dominates completely, it should be easier for a few active strategies to make money because there are very few people actively interpreting new information to assess its impact on companies.
In effect, there should be a stable state in the market where the share of active funds is not so large that they all compete away their informational advantage over passive strategies to an extent that they can’t justify their fees. This thesis borrows loosely from the work of biologist Maynard Smith who applied this to evolutionary theory. Of course, this won’t help us predict what the share of each strategy is in the theoretical stable state, but my hunch is that it is not close to either 90/10 or 10/90.
January 20, 2009 · Basab Pradhan
Research Data Analytics, or managing data and spreadsheets, is a large percentage of what constitutes company research. This is true for researchers in any industry – institutional investors, sell-side research, investment banking, management consulting and corporate development.
The real value of a researcher’s work is in bringing his or her insight about the company to bear upon its analysis. Yet they spend an inordinate amount of time on managing historical data and quarterly updates in spreadsheets even though they know that this is not the best use of their time. What if this was not so? What if everything related to Research Data Analytics were no longer the researcher’s headache? They would still control the design of the analytics, but wouldn’t have to labor over its construction. What would it take to make this so? Continue Reading…
