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Last updated: September 15, 2013 4:54 am
Hedge funds are turning to satellite technology, traditionally used by governments to gather military intelligence, to gain a competitive edge.
Hedge fund managers are particularly interested in satellite imagery in order to monitor risk exposures around mines, ports, plantations or farmland before making investments.
Satellite images can demonstrate which of two neighbouring mines is producing the most coal, for example.
Fund managers are also interested in assessing the quality of ore in a pile, or the health of crops, which satellites can assess using infrared measurements.
Hedge funds are similarly using geospatial images to track fill rates at car parks at big retailers such as Walmart to provide an indication of company revenues ahead of quarterly results.
Mike Gantcher, head of sales at RS Metrics, a satellite intelligence provider, said the company has picked up 25 hedge fund and money manager clients in the last two years and that business growth has been “exponential” this year.
Dan Schnurr, chief technology officer at partner company Geospatial Insight, said the bulk of asset managers are likely to adopt the technology “as the data costs come down”.
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