• Were you looking for...

Alternative Data for Capital Markets: Trade Payment and Stock Returns

Dun & Bradstreet has the largest global commercial database on the planet. At the core is proprietary trade payment data collected from thousands of trade suppliers, which is closely related to account payables on company’s balance sheet. The Credit Score Archive Database (CSAD, 2004-2016) is directly derived from the raw trade payment data, and has about 140 attributes including a company’s payment behavior and various risk assessments. We’ve applied a statistically rigorous process to identify top attributes that have predictive power in separating cross-sectional stock returns – some of the attributes are further transformed to make suitable for testing. In each document, we present one attribute for illustration purposes. The attribute shows from a unique and proprietary angle how D&B data and analytics helps to enhance stock returns. The complete list of attributes identified, with test statistics, is available upon request.

“High Relative Trade Credit Underperforms”:

Dun & Bradstreet found that stocks with high relative trade credit (to sales) underperform those with low relative trade credit. The underperformance is statistically significant after adjusting for the Fama-French 3-factor model + MOM (aka FF3+MOM). Download whitepaper.

“The Hidden Cost of Growing Trade Supplier Networks Too Fast”:

Dun & Bradstreet found that stocks with the fastest growing number of trade suppliers year over year underperform those with slowest growing trade suppliers. The underperformance is statistically significant after adjusting for the Fama-French 3-factor model + MOM (aka FF3+MOM). Download whitepaper.

“When Slow or Negative Payment Experiences Accelerate”:

Dun & Bradstreet found that stocks with the fastest increase in the number of slow or negative payment experiences month over month underperform those with slowest increase. The underperformance is statistically significant after adjusting for the Fama-French 3-factor model + MOM (aka FF3+MOM). Download whitepaper.

Start a Live Chat
Let's get in touch
Fill out this form, and we'll contact you soon.
FREE Alerts to Changes in Your D&B® Credit Scores!* Sign Up. Get CreditSignal® for FREE!*
Try D&B Credit for Free! Get Started. Try D&B Credit for Free! Get Started.