Transaction data is one of the most direct alternative data signals available to institutional investors. Where most behavioral data measures attention or intent, transaction data measures actual spending. For consumer-facing companies, real consumer spend figures derived from credit card and payment data have become a standard part of the pre-earnings research toolkit.
This post covers what transaction data is, how it is sourced, where it works best, its limitations, and how it fits alongside other alternative data sources in a modern investment workflow.
What transaction data is
For investm