A New Tool Will Help Investors Track President Trump’s Effect on Companies
How will Donald Trump‘s new administration actually affect companies? That’s the question investors are asking now that the President’s policies are actually beginning to take shape. And a new tracker is hoping to provide the answer in real time.
In the months following Trump’s election, most investors wagered that Trump would be able to enact his promised pro-economic growth policies. So they threw billions of dollars into the stock market, with the Dow Jones industrial average recently breaking 21,000. But now that the Trump Administration has released a budget proposal, and is struggling to push a health care repeal bill through a friendly Republican Congress, the markets have more than just campaign promises to bet on.
“We are getting past the hype and hope stage to see what Trump is really able to do,” Alap Shah, CEO of the financial analysis platform Sentieo, said in an interview.
So Sentieo is unveiling a new website Wednesday dubbed the “Trump Tracker.” The tracker combs through companies’ regulatory filings and presentations and highlights references to Trump or his policies using select key words. That can include phrases such as “Executive Order,” “Obamacare,” and “NAFTA.”
For example, the Trump Tracker would likely note Goldman Sachs’ reference to Trump’s proposed tax cuts during a January earnings call. At the time, Goldman Sachs executives said that “changes in tax policy can be a huge catalyst.”
The Trump Tracker aims to provide investors with insight into what company executives are most worried about when it comes to the new administration — even when they don’t mention the President by name.
Already, Sentieo has uncovered evidence that companies worry about Trump’s impact more than investors might realize. Since Trump was sworn into office, 27% of health care companies mentioned Trump by name in the risk section of their annual or quarterly filings, as did 20% of energy companies, 16% of real estate firms, 13% of financial firms, 4% of non-essential goods companies, and 3% of the tech sector.
It’s possible the tracker may understate companies’ true concerns about the Trump Administration, as the algorithm may fail to count veiled or euphemistic references to the White House, or attempts from management to dance around the topic.
Sentieo’s filters currently only pick up on the most popular Trump-related phrases, so it may miss other relevant terms. For example, while “Mexico” is a searchable term in the tracker, “Steven Mnuchin,” Trump’s Treasury Secretary, is not. And the tracker stays away from more generic phrases that could refer to Trump, or could just as easily refer to normal business operations such as “president” or “taxes.”
Shah acknowledged the tracker is a work in progress, and that the free tool it is a pared down version of the Trump Tracker’s sister product, which is locked behind Sentieo’s paywall. Still, Shah said he plans to add more features in the future, allowing users, for example, to analyze the data on the site rather than just browsing through it.
The Trump Tracker joins a growing number of new investing products that have bloomed around the so-called Trump trade, which has made investors particularly sensitive to how the President will impact their portfolio. One startup has launched an app called Trigger, which alerts users if Trump tweets about publicly traded companies. And the “Trump and Dump Bot,” created by advertising agency T3, detects when the President tweets something negative about a company, then quickly sells the stock short, making money if the share price drops.
The real-time nature of these products illustrates investors’ need to keep up with Trump’s unpredictable presidency — and trade stocks just as rapidly.
“It’s what’s the investors demand,” Shah said.