How our AI Stock Picks outperform the market by analyzing alternative data
August 29, 6:32 pm
In the world of stock trading, staying ahead of the curve is paramount. Traditional financial analysis, although essential, may not always provide a complete picture of a company's potential. That's where artificial intelligence (AI) and alternative data analysis come in handy. By examining non-traditional data sources, such as social media activity, job postings, mobile app downloads, and employee satisfaction, etc, our algorithm provides a more comprehensive assessment of a company's prospects.
In this article, we will highlight the performance of our AI stock picks in February and dive deeper into some of the picks.
February Performance Highlights
Our stock picks approach in February, as detailed in the accompanying table, yielded a 69% success rate in favorable stock picks, contributing to a 27% positive return. One of the notable successes was Opera ($OPRA), which has had a 130% increase since our signal. This signal was based on a spike in business outlook, app downloads, and other factors. Another success was the buy signal on Remitly (RELY), which was predicated on several positive indicators, including a month-over-month spike in YouTube subscribers, job posts, mobile app downloads, and employee satisfaction. Following our signal, Remitly's price surged by 91.1%. Additionally, our sell signal for Bed, Bath & Beyond was spot on, as the company's job posts took a nosedive, the financials were in poor shape, and sentiment across popular stock forums was plummeting. Bed, Bath & Beyond has since declared that they are going ouf of business and the stock has been delisted from the NASDAQ exchange.
| Asset | Date | Rating | Price at Time | Change % | Status | |
|---|---|---|---|---|---|---|
 |
Silk Road Medical(SILK) |
Feb 1, 23 | Buy | $55.57 | -63.8% | Lose |
 |
Steel Dynamics(STLD) |
Feb 1, 23 | Buy | $124.34 | -13.6% | Lose |
 |
Opera(OPRA) |
Feb 1, 23 | Buy | $6.32 | 138.9% | Win |
 |
Abercrombie & Fitch(ANF) |
Feb 1, 23 | Sell | $29.23 | 74.6% | Lose |
 |
TherapeuticsMD(TXMD) |
Feb 1, 23 | Sell | $5.31 | -28.6% | Win |
 |
Bed Bath & Beyond(BBBY) |
Feb 1, 23 | Sell | $2.82 | -96.5% | Win |
 |
The Children's Place(PLCE) |
Feb 1, 23 | Sell | $46.14 | -42% | Win |
 |
Remitly(RELY) |
Feb 4, 23 | Buy | $13.00 | 91.1% | Win |
 |
Urban Outfitters(URBN) |
Feb 7, 23 | Sell | $27.88 | 19.4% | Lose |
 |
iRobot(IRBT) |
Feb 8, 23 | Sell | $41.79 | -6.5% | Win |
 |
Flanigan's Seafood Bar and Grill(BDL) |
Feb 10, 23 | Buy | $27.46 | 10% | Win |
 |
Canopy Growth(CGC) |
Feb 10, 23 | Sell | $2.28 | -82.5% | Win |
 |
Portillo's(PTLO) |
Feb 14, 23 | Buy | $22.91 | -19.2% | Lose |
 |
e.l.f. Cosmetics(ELF) |
Feb 14, 23 | Buy | $73.77 | 80.4% | Win |
 |
MakeMyTrip(MMYT) |
Feb 15, 23 | Buy | $26.49 | 45.4% | Win |
 |
Tilly's(TLYS) |
Feb 21, 23 | Sell | $8.65 | -0.2% | Win |
Continuous Improvement
While February yielded robust results, it's crucial to note that not all picks were perfect. Our algorithm encountered some challenges, including a buy signal for Silk Road Medical ($SILK), which did not increase as anticipated despite several encouraging indicators. Similarly, our algorithm predicted a stock price decrease for Abercrombie & Fitch ($ANF) based on deteriorating financials and a long-term decrease in social media followers and job posts. The stock did not perform as predicted, indicating that the threshold for these indicators was too low as can be seen in the company's quick bounce-back in its AI Score in March. These instances have provided valuable lessons for tweaking our algorithm to improve future stock picks.
Our algorithm's performance in February demonstrates the immense potential of combining AI and alternative data analysis in stock picking. While we celebrate our successes, we also acknowledge and learn from our mistakes. Continuous improvement is key to refining our algorithm, and we are committed to making the necessary adjustments to provide more accurate stock picks in the future.
Conclusion
Our algorithm has consistently demonstrated its ability to make successful stock picks, as illustrated by our recent performances. Among the February signals, a notable 69% of the stock picks resulted in gains, contributing to an overall positive return of 27%. This is a strong follow-up to January where 85% of our signals yielded favorable outcomes, resulting in an overall positive return of 23.3%. These results reinforce the value of our approach, which harnesses the power of alternative data analysis to identify investment opportunities that traditional methods might overlook. As we move forward, we remain committed to refining our algorithm, learning from both our successes and our mistakes, to provide our clients with the most reliable and profitable investment signals.
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