Data published by SharingAlpha, the platform used by fund selectors to generate track records of their own, suggest that the UK is a key jurisdiction when it comes to finding those selectors with a quantifiable ability to generate alpha.
According to the data, which looks at the broader user base of SharingAlpha globally, not only does the UK have a lead in the number of selectors that have started building up a track record, but it is also home to a number of selectors who are ranked highly for their predictive abilities, according to the methodology used to measure this capability.
SharingAlpha’s platform can generate ‘Triple’, ‘Double’ and ‘Single’ Alpha ratings of buy side professionals, which they can use to benchmark themselves against peers.
|Country||Total Top Raters||Triple Alpha||Double Alpha||Single Alpha|
The ranking of fund selector abilities is done by measuring the ratings selectors place against funds and then comparing future performance of those funds against comparable ETFs.
The ratings are tracked over time to gauge how well previous assessments have materialised. The closer an assessment to the real results of a fund, the higher the ‘hit score’ attributed to the individual selector. By comparing hit scores against those of other users of SharingAlpha, it is possible to put selectors into percentiles; the top decile obtain the Triple Alpha ranking; those in the 10%-25% are ranked Double Alpha, for 25%-50% it is Single Alpha. Below 50% there is no Alpha ranking given.
To qualify, the user must accumulate at least 500 rating samples, and rate a minimum of five funds.
Further information on the SharingAlpha methodology can be found at https://sharingalpha.com/info/faq