Refinitiv and the Open Data Institute (ODI) have published a report entitled 'A New Dimension of Data – Building an Open and Trustworthy Alternative Data Ecosystem'.

According to the report, with over a thousand purported alt data sources, hundreds of case studies and millions in global spend, the alt data sector seems to be gaining traction. The alternative data market, however, remains a very small part of the multibillion-dollar market for access to stock market and other financial data.

While the governance and norms for the licensing and distribution of traditional data are well established in many countries, the alt data market is at an early stage. Best practices, codes of practice, regulations and standards have not yet been fully established.

Enabling the integration and use of such a disparate set of data sources will require the development of a new set of standards. The report addresses key considerations for understanding and standardising alternative data, including:

• What is alternative data?
• How is alt data currently accessed, used and shared?
• Ethical and legal considerations in alt data
• Improving access to alt data
• Recommendations and Next steps

Austin Burkett, Global Head of Quants and Feeds, Refinitiv, said, "The rise and success of quantitative analysis and investing using alternative data has taken the broader financial community to an inflection point when it comes to understanding, sourcing and applying these data sets to add greater insight and investment value. At Refinitiv, we believe that alternative data ought to be standardized and where possible, normalized in order to improve data quality and reliability to better serve clients with the highest ethical and legal considerations."

Jeni Tennison, CEO of the ODI, said, "Working in collaboration with Refinitiv on this Alternative Data report has allowed us to investigate an emerging data ecosystem: data used by investors to help evaluate a company or investment that comes from new and unique sources. There is a market for this. For example, some companies are analysing real-time sentiment data, in the form of positive or negative social media posts and making predictions on company performance before any traditional data is released from the company. However, we have found that the ecosystem is struggling from a lack of standards and transparency, creating issues around privacy, intellectual property, and trust."

The alternative data report was written using extensive desk research, user research interviews with 13 professionals in the alternative data space and an expert roundtable of 12 participants.