Business Intelligence (BI) Sneak Peek

 


Many investors today realize the power of Business Intelligence (BI) analytics. According to the most recent BARC survey, such as Data, BI & Analytics Trends Monitor (09/2021), BI analytics was highlighted by 60% of respondents and has also been among the top trends over the recent years; 47% of respondents confirmed that the establishment of a data-driven culture is having a significant impact on their investments.

The present guide is aimed to design data-rich BI applications that convert market data and financial KPI’s from myriad financial sources (annual report, balance sheet, income or cash flow statement, etc.) into meaningful information for investment decision-making. Specifically, the focus is on open-source BI investment solutions as a low-cost alternative to major BI vendors such IBM, Oracle [14], and MS Power BI. These solutions compare baseline metrics against current ones (to target difference in both relative and absolute terms), identify credible trends and effectively represent market data to inform investment decisions during planning and monitoring stages discussed earlier.  

A wide variety of profitability, liquidity, efficiency, valuation and leverage KPI’s and financial metrics are routinely used by BI specialists to help monitor business success of their organizations [14, 15]: Working Capital, Return on Assets (ROA), Return on Equity (ROE), Operating Cash Flow (OCF), Sales Growth, Earnings Per Share (EPS), Debt-to-Equity Ratio (DER), etc. Most common metrics for investment risk management are as follows [1]: Standard Deviation (STDEV), Sharpe Ratio (SHR), Beta, Value at Risk (VaR), Conditional VaR (CVaR), and R-squared (R2). The challenge is to determine the most useful set of metrics K for your investment portfolio, although some KPIs are almost universally applicable. In the sequel we will attempt to address this problem by examining the benchmark condition         

KR=K/K0~1+/-e (e<<1)

against a reference value K0 such as the peer-group average over a period of time. If this condition is met, the underlying process is regarded as OK. By limiting the number of deviations, the overall RRR-performance improves and associated risks decrease.   


Comments

  1. VA DigHiSciJanuary 22, 2022 at 10:51 AM

    This is about open-source BI investment solutions to handle a wide variety of profitability, liquidity, efficiency, valuation and leverage KPI’s and financial metrics. The benchmark condition is the crucial point of determine the range of metrics suitable for risk aware investment portfolios.

    ReplyDelete
  2. VA DigHiSciJanuary 25, 2022 at 5:23 AM

    https://youtu.be/21HDH-7ve1A
    Check this link

    ReplyDelete

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