AmalgaMood LLC is a Washington D.C. based Financial Market Information Intelligence company. It focuses on using text analytics and quantitative analysis on such publicly available information as social media, traditional news, and user generated content to determine the social mood towards financial market instruments. Its system is based on a patent-pending process.
As applied to equity investing, AmalgaMood’s Mood Index would have kept investors out of the equity markets during the entirety of the 2007-09 bear market, while signalling re-entrance within three weeks of the March 2009 low. More recently, its Mood Index highlighted a deteriorating equity environment prior to the July-August 2011 global equity collapse.
AmalgaMood was founded by Kevin John Coogan. During his 18-year international finance career, Mr. Coogan has been a partner at several leading alternative investment firms serving as a global macro hedge fund portfolio manager, a quantitative trading system developer, a proprietary desk trader, and an equity analyst.
Kevin John Coogan brings extensive experience in global equity investing, trading system development, and text analytics.
Mr. Coogan is the Founder and Managing Director of AmalgaMood and creator of its patent pending algorithm that uses text analytics and quantitative analysis on the live Internet (such as social media, user generated content, and news) to determine the direction of society’s aggregate social mood as it relates to the global equity market. Prior to founding AmalgaMood, Mr. Coogan was a founding Partner at BR Investimentos, an alternative asset management firm, a Partner at JGP Asset Management, a global hedge fund, and a proprietary desk trader and equity analyst at Banco Pactual, a global emerging market focused investment bank.
Mr. Coogan has spoken at various conferences on using text analytics to improve investment strategy. He is a graduate of the University of Richmond’s E. Claiborne School of Business, and holds an International MBA from the University of South Carolina’s Moore School of Business.
Andrew Smith offers considerable investment banking, valuation, compliance and accounting knowledge as well as rich insights into rapidly growing businesses.
Mr. Smith is a Principal and Senior Managing Director with The McLean Group, one of the largest middle market investment banks in the United States. He has been a designated expert witness in numerous court cases testifying on financial topics and is a frequent speaker and author on business valuation. He began his career at KPMG Peat Marwick, one of the largest tax and advisory firms in the world, where he served as a corporate finance and audit manager in its Washington DC, Moscow, and Almaty offices.
Mr. Smith has served as an Adjunct Professor with George Mason University’s MBA Program, as a national instructor with the National Association of Certified Valuators and Analysts (NACVA), and as a guest lecturer at the University of Maryland’s and John Hopkins University’s MBA programs. He is a Certified Public Accountant, Accredited in Business Valuation, Accredited Senior Appraiser, Certified Valuation Analyst, and Certified Management Accountant. He is a Financial Industry Regulatory Authority (FINRA) registered representative, registered investment banking representative, and financial and operations principal (Series 7, 28, 63, and 79 licenses).
Joseph Mullin brings vast hedge fund and private equity knowledge.
Mr. Mullin is currently the CEO of General Word Development LLC, a children’s media business. He was previously a Portfolio Manager for Millennium Global Investments Ltd., an independent, privately-owned investment management firm, where he held several positions between October 2007 and November 2010. Mr. Mullin was a Research Analyst at WL Ross & Co. LLC (now part of Invesco Ltd.), an asset management firm, from April 2001 to October 2007. Mr. Mullin worked in Brazil on a private investment portfolio from 1998 to 2001. Mr. Mullin began his career as a Financial Analyst in the Corporate Finance Department at Goldman Sachs. He has been a Director of several companies. Mr. Mullin holds an A.B. degree from Harvard College.
Luke Bunting offers expert insights into new developments in social media and on-line reputation management.
Mr. Bunting founded and currently serves as president of the Bunting Group, an interactive marketing company that creates on-line strategies for its clients through its interpretation and analysis of social media to identify market trends. Mr. Bunting has developed online marketing strategies for Fortune 500 companies as well as analyzed user response to improve brand reach.
Joseph Hilger brings extensive practical experience with content management, search, and big data.
Mr. Hilger is the Practice Manager co-responsible for the Washington, DC office of Avalon Consulting (http://www.avalonconsult.com/home), a leading provider of enterprise Web, Search, Big Data, and Learning solutions, recognized as one of the fastest growing private companies in the United States through its inclusion in the 2011 Inc 5000. His experience includes helping financial services, media, and telecommunications firms, non-profit associations, and higher education organizations implement enterprise IT solutions. Previously, Mr. Hilger worked as a Managing Consultant at EDS, now part of HP Enterprise Services (http://www8.hp.com/us/en/services/it-services.html), a leading global IT business services company, and for Coopers & Lybrand, now part of PricewaterhouseCoopers (http://www.pwc.com/us/en/index.jhtml), the world’s largest professional services firm by revenue.
Mr. Hilger is widely regarded as an expert in implementing both Enterprise Content Management and Enterprise Search products and has spoken on the effective use of search, as well as complex portal implementations, at a number of industry conferences. He is a graduate of Boston College with a Bachelor of Arts degree in Management Information Systems and Finance.
This is an extraordinary period of change for the financial markets due to the impact of two secular variables; (1) Information Overload, and (2) Globalization of Markets. AmalgaMood focuses on providing the tools to investors so that they can survive this period of dramatic change.
Information Overload overwhelms professional and private investors alike, producing poor analysis and decision making. An average individual might be able to effectively read and analyze a few hundred news articles per day. Decades ago, that might have been enough to remain up-to-speed with the markets. At present, any individual with an Internet connection has daily access to hundreds of thousands of news articles, tens of millions of blogs, and over a hundred million tweets. The situation has inverted from investors yearning for more information to being hit from all angles with information. Summarizing, individuals are no longer able to consume the large quantities of information available and experience overload.
Globalization of Markets likewise overwhelms investors. Investors closely following their particular national equity market and regional economy would have been fine a few decades ago, as individual markets possessed significant independence from global influences. More recently, global financial markets have become intertwined to such a degree that all principal equity markets tend to have the same directional trend movements – all entering major bull and bear markets at approximately the same time. Additionally, relevant variables of one market will directly impact national markets of other countries. Summarizing, there are too many markets and variables for individuals to successfully follow.
AmalgaMood consolidates and quantifies the flux of global information in such communications as blogs, tweets, and news articles, creating its trending Mood Index so that investors know in which direction the global social mood, as it relates to equity investing, is heading. Understanding this trend, investors can better focus on reading the information that is most interesting to them (instead of trying to read everything) and follow their own investments closer (instead of trying to follow every variable of every global market).
The observations that resulted in the creation of the Mood Index occurred in the 1990s. At that time, AmalgaMood’s founder worked as a proprietary desk trader and as a portfolio manager of a global macro hedge fund covering markets in varying time-zones. Investing simultaneously in such diverse equity markets as the United States, Japan, South Korea, Hong Kong, India, Turkey, Russia, South Africa, and Brazil, he experienced an early form of information overload and witnessed the beginning of the globalization of markets first hand. His experiences during this period directly lead to the development of the Mood Index.
A characteristic of international investing during the 1990s was the rolling crises in emerging markets. A strong contagion effect resulted in most emerging markets moving from one crisis to the next throughout the decade in approximate unison. This translated into massive alternating waves of improving and deteriorating social mood. The accompanying equity bull and bear markets produced, in some countries, multiple factor gains and declines of over 90% during these alternating waves.
Near bear market bottoms, social mood tended to hit extremely depressed levels. In other words, market participants and society in general became extraordinarily negative on the market, the economy, and even the country’s non-economic prospects. Depressed sentiment supported depressed fundamental data, and vice-versa. Near bull market tops, the reverse occurred. Social mood hit extremely positive levels. Strong fundamentals supported enthusiastic sentiment, and vice-versa.
Analysis of broker research reports and economic news articles detected these extremes. Somewhat more surprising — studying non-economic news articles and speaking with locals on a variety of topics produced similar observations of cyclical mood extremes. Though many financial market participants who have lived through a series of such mood cycles would agree as to their existence, measuring such waves and determining the timing of inversions were not yet possible.
Having experienced these mood cycles first hand while trading equity in these markets, AmalgaMood’s founder began to develop a text analytics system, with the eventual goal of creating a time series that would be able to determine significant shifts in society’s collective mood. He started by rating news articles, annual reports, press releases, and broker reports, many of which arrived via mail and fax (yes, most investment related information arrived in printed form well into the 90s), by hand. Proving useful at determining market extremes, he continued to develop the rules to what would eventually become the basis of the Mood Index.
The true sea change arrived in the mid to late 2000s as increasing amounts of publicly available information became readily accessible on the Internet in digital form. The prime examples include the creation of twitter, the rapid expansion of blogs, and the proliferation of global news feeds. These new sources of information allowed for a broader sample of content creators to be analyzed, also in quasi real-time. The amount of information went well beyond hand-marking, and the rules were formalized and placed into a database system in order to automate the analysis.
A beta-version of the automated Mood Index called the March 2009 bear market low. As the Mood Index continued to develop with the addition of new sources of information and as it continued to perform well during an extremely difficult global equity environment, Mr. Coogan decided to make the Mood Index publicly available. Researching intellectual property protection during 2010, he eventually applied for a US patent in January 2011 and soon afterwards launched a website, offering the Mood Index to the public.