- Goldsky’s Global Access Fund capped the year with 24.22% returns, outperforming its benchmarks as the MSCI World Index rose 14.75% in 2017 and the S&P 500 jumped 21.78%
- The solid performance last year extended the hedge fund’s winning months to 14 consecutive months of consistent positive gains.
It was a perfect year for Goldsky Asset Management, the Australia-based quantmental and behavioral science focused hedge fund that specializes in global equities, with positive gains every month last year. Goldsky’s Global Access Fund capped the year with 24.22% returns, outperforming its benchmarks as the MSCI World Index rose 14.75% in 2017 and the S&P 500 jumped 21.78%.
The solid performance last year extended the hedge fund’s winning months to 14 consecutive months of consistent positive gains. The fund is also a constant outperformer with 14.67% and 23.76% returns in 2015 and 2016, leaving its benchmarks trailing during the periods. The MSCI World gained 6.14% in 2015 and 8.36% in 2016, while the S&5 500 reported gains of 4.24% and 11.19% in those years.
Goldsky founder and President Ken Grace attributed the fund’s reliable results through their efficient use of machine learning news. Goldsky’s management principle is grounded on the belief that superior long-term results can be achieved by systematically exploiting information that is not obvious.
He stated, “Many features of news-based information make it especially appealing. Real-time news, though less structured than conventional fundamental valuation measures, usually encodes the first clues of major changes affecting a company. You could, for example, use news fragments to build statistical forecasting models that dynamically adjust price targets.”
Since its launch, Goldsky’s cumulative gain is at 19.80% compared to MSCI World’s 10.05%, proving Grace’s point.
Friendship with investors
More than providing high and consistent returns for their investors, Goldsky’s Behavior Sediment Data Specialist Jack Bow said the company also places heightened importance on establishing interpersonal relationship with all their investors.
“We do this as to ensure we have personal relationships with our investors,” Bow said. “We are passionate about having a face/family and friendship associated with each of our investor network. This is a choice Goldsky has made to maximize our own personal life by knowing the impact that originates from the Goldsky Global Alpha Fund. Goldsky can proudly say that each we have never lost an investor.”
The use of social media
According to Grace, Goldsky is utilizing social media in which the feedback on content can be systematic trading because it is an ever-evolving competition. One key arena indirectly measured sharing items tend to separate noteworthy content from ambient noise. Replies and discussions provide on-the-spot feedback about opinions and emotional responses.
He explained, “Aggregated data on news supply and demand can be used to detect abnormal spikes. Often, such spikes happen alongside major company events. When you track such analytics for a large portfolio of stock, you can identify the market focus and hot-spot stocks in real time.”
Although the advantages of news-related data are obvious, so are the technical challenges, Grace said. Deriving quantitative indicators from a text is daunting and requires experts to prepare and maintain a set of classification codes and taxonomies. Although there’s a large amount of academic research in the field, significant advances began only recently with the availability of efficient machine-learning techniques and high-performance computing hardware, he said.
Algorithmic trading strategies and quants taking over many Wall Street trading floors
Bow further explained that traditional fundamental and technical analysis is giving way to strategies based on machines and unique data sets. One such approach: tracking event-driven news. Using computer-reading of news on the rise, Wall Street is changing how reporting is digested. Many hedge funds and quants have thus developed ways to trade the markets based on news and social media sentiment, confidence, and story counts.
Goldsky has applied techniques to flag news worthy story or tweet as being relevant to an individual stock and then assign a sentiment score to each article or tweet in the feed, Bow stated.
He said that when applied to trading, “sentiment can simply be used as a directional signal to figure out whether you should be long or short stocks within your portfolio or universe.” And added, “A typical behavioral assumption is that if there’s positive news on a company, its share price will rise and vice versa.”
2017 AsiaHedge Awards
In October, Goldsky Asset was named among the top hedge funds in the Asia Pacific region over the past year at the 2017 AsiaHedge Awards in Hong Kong, securing the prestigious Global Equity award on a risk versus return criteria. Beating out eight international competitors.
“The AsiaHedge award is a testament to what we have been able to achieve on behalf of investors, that is ensuring the highest possible returns combined with the lowest risk profile,” commented Grace.
CONTACT GOLDSKY ASSET MANAGEMENT ( AUSTRALIA )
Goldsky Asset Management ( Australia ) PTY LTD
Level 29, Chifley Tower, 2 Chifley Square, Sydney, NSW 2000, Australia.
T16/17 Bells Boulevard, Salt village Kingscliff, NSW, 2487, Australia
Victor Popov, Business Development Manager
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