Six stocks and funds to play the big data theme

Companies have always understood that knowing their customers well is crucial to commercial success. Now big data allows them to know them in far more detail than was possible before.

The amount of data being generated is phenomenal. Already, the world has 2.7 billion internet users - 39% of the global population - as well as 6.8 billion active mobile device subscriptions. It's not just traditional data - think Word documents or Excel spreadsheets - that is being generated; unstructured data is proliferating at an astonishing rate.

Every single minute of the day, for example, Facebook users upload 208,000 photos while Twitter users post 350,000 tweets. The US market research house International Data Corporation reckons that in 2014 alone, the volume of data generated globally will exceed six zettabytes - one zettabyte is equivalent to roughly 250 billion DVDs.

If you want to gain exposure to the phenomenon, US firms lead the way in big data technology, but Europe also has some stars.

Below, David Prosser profiles some of the best candidates.

Fusionex (FXI)

Malaysian business intelligence and data analytics compan Fusionex (FXI) is already profitable and was one of the most successful floats of 2012.

Its share gained 250% in the firm's first 14 months on AIM.

The stock slipped back this year when technology company valuations the world over fell, but the company has continued to win contracts.

Splunk (SPLK, NASDAQ)

Splunk (SPLK), which floated on NASDAQ in 2012, produces answers to complex business problems based on data gathered by machines - such as anticipating when a business's computer network is likely to fail or when a bank is about to fall prey to fraud or a rogue trader.

The stock traded above $95 (£57) at its peak earlier this year but has since fallen to about $41.

Tableau Software (DATA, NYSE)

When you have millions of columns of data and a huge number of datasets, you need to be able to quickly display, analyse and understand them. Enter Tableau (DATA), whose data visualisation software offers a range of ways to do exactly that.

Following its US flotation at $75 a year ago, Tableau's stock rose above $100 but is now closer to $60.

Wandisco (WAND)

AIM-listed Wandisco is the only listed company that enables investors to bet on Hadoop, an open-source software framework that provides data storage and processing at a fraction of the cost of traditional methods.

Wandisco is an early-stage business, but its business model of offering Hadoop solutions could prove very profitable in the long term. In the short term, its shares have fallen from above £15 to £4 over the past year or so.

Polar Capital Technology Trust

Ben Rogoff, manager of the Polar Capital Technology Trust, is an enthusiastic investor in the big data and analytics themes, both pure play stocks and broader technology companies that have exposure to the big data theme.

Rogoff took profits on a number of his big data holdings before the correction earlier this year, but has since been buying back in.

Marlborough UK Micro Cap Growth

The Marlborough UK Micro Cap Growth fund is an option for investors who don't want to bet the house on big data or even on the tech sector.

Manager Giles Hargreave is widely admired as one of the UK's leading investors in small companies. The fund offers exposure to big data plays such as Wandisco.

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.