On the Capital Market Consequences of Big Data: Evidence from Outer Space

Zsolt Katona, Marcus O. Painter, Panos N. Patatoukas and Jean Zeng

Journal of Financial and Quantitative Analysis, 2025, vol. 60, issue 2, 551-579

Abstract: We use the introduction of satellite coverage of major retailers to study the capital market implications of unequal access to big data. Satellite data enabled sophisticated investors with access to such data to formulate profitable trading strategies, especially by targeting the upcoming reports of retailers with bad news for the quarter. The introduction of satellite data led to more informed short-selling activity, less informed individual buying activity, and lower stock liquidity around the reports of retailers with satellite coverage. We conclude that unequal access to big data can increase information asymmetry among market participants without immediately enhancing price discovery.

Date: 2025
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