The efficient market hypothesis in its semi-strong form posits that asset prices reflect all publicly available information (Fama, 1970). Therefore, to achieve outperforming trading profits, one would need to obtain information unavailable to the public. Recently, there has been growing evidence of such information flows through social connections, education networks (Cohen, Frazzini and Malloy, 2008, 2010), geographical proximity (Coval and Moskowitz, 2001), expert networks, as well as through direct contact of agents involved in financial management processes with corporate insiders.
But as scrutiny on insider trading has intensified and the correlation among systematic strategies have also increased dramatically in recent years, innovative managers have now a unique opportunity of exploring new data. The combination of unique sets of big data and technology driven investment processes is a potential new source of uncorrelated excess returns.