Data Analytics in Finance

It is a capital mistake to theorize before one has data.” — Sherlock Holmes

 

As it is said that data is the new oil. So, it’s quite obvious that we need to fuel our financial engines with data too. The use of data is indispensable in the domain of finance be it making better investment decisions with consistent returns or algorithmic trading using vast historical data with complex mathematical models to maximize portfolio returns. The automated computer programs bring in the capacity to execute trades involving a huge chunk of data within a fraction of second that was unfathomable at a point in time. It also reduces manual errors due to behavioral factors.

 

Although, a huge chunk of data has its own setbacks like highly sophisticated techniques and complex procedures to infer accurate results, the vast proliferation of data and technological advancements in the domain of data analytics is transforming the way financial industries operate and compete.

 

 

-Shubham Raj (IIM Raipur)

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