Millennials are 2.5x times more likely to use alternative data than non-Millennial equity analysts, according to a study to be published on Alternative Data Insider, an educational website recently launched by alternative data researcher YipitData.
82% of analysts who use alternative data are Millennials (20-38 year olds), highly concentrated between the ages of 26-34, based on a study conducted on YipitData’s user base. More generally, Millennials represent 65% of buy-side equity analyst demographics based on data from Ipreo.
According to YipitData, the average age of alternative data users is 33 years old, compared to 36 years for buy-side analysts generally.
“It is likely that the core concentration of Millennials became investors 5-7 years ago, right at the time when alternative datasets started exploding,” said Pablo Cerrilla, Director of Partnerships at YipitData. “As a result, Millennials began incorporating alternative data as they were becoming investors. More experienced analysts and PMs have a steeper learning curve, having to adjust their investment style and rethink what’s possible.”
Another possible reason for the skew toward Millennials is that use of YipitData tends to be delegated to the most junior buy-side staff. Whatever the explanation, the congruence of alternative data and Millennials is intuitive. Once Generation Z begins to enter the picture, alternative data usage will only accelerate further.