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jerryking : quants   19

The quant factories producing the fund managers of tomorrow
Jennifer Thompson in London JUNE 2, 2018

The wealth of nations and individuals is ever more likely to be influenced by computer algorithms as investors look to computer-powered quantitative trading strategies to generate returns. But underpinning those machines and algorithms are real people, namely the world’s sharpest mathematicians and data scientists.

Though not hard to identify, virtually every industry — and especially Big Tech — is competing with the financial world for their skills....Competition for talent means the campuses of elite universities have become a favoured hunting ground for many groups, and that the very best students and early career academics can command staggering starting salaries should they join the investment world......The links asset managers foster with universities vary. In the UK, Oxford and Cambridge are home to dedicated institutes established and funded by investment managers. Although these were set up with a genuine desire to foster research in the field, with a nod to philanthropy, they are also proving to be an effective way to spotting future talent.

Connections between hedge funds and investment managers are less formalised on US campuses but are treated with no less importance.

Personal relationships are important,
mathematics  data_scientists  quants  quantitative  hedge_funds  algorithms  war_for_talent  asset_management  PhDs  WorldQuant  Big_Tech 
june 2018 by jerryking
Meet the People’s Quant, an Ex-Marine Who Champions Value Investing - WSJ
By Chris Dieterich
June 2, 2017

Wesley Gray’s value-focused fund of overseas stocks is beating all its rivals over the past year. For him, it’s almost beside the point.

Mr. Gray, chief executive of asset manager Alpha Architect LP outside of Philadelphia, says watching short-term market moves doesn’t pay off. Instead, his firm focuses on the benefits of finding and buying a small number of very cheap stocks, and holding them through thick and thin.

Alpha Architect is an upstart active investment manager that tripled its assets last year, a noteworthy performance at a time when traditional stock pickers are struggling with lackluster performance and investor withdrawals. The firm, with $522 million in assets, is among a growing crop of money managers using academic financial and behavioral research, and algorithms, to identify stock bets likely to beat the market.

So-called quantitative investment strategies pulled from academic research have been around for years, popularized by the likes of Dimensional Fund Advisors and AQR Capital Management. Mr. Gray and Alpha Architect aim to deliver highly potent iterations to smaller investors.

Mr. Gray is a former captain in the U.S. Marine Corps who served a tour in Iraq, and later earned a Ph.D. in finance from the University of Chicago Booth School of Business. He says extreme discipline is a crucial component of his concentrated, algorithmic adaptations of classic value investing, popularized by Benjamin Graham and Warren Buffett.

Last year Mr. Gray put out a report, “Even God Would Get Fired as an Active Investor,” concluding that stock-picking foresight alone wouldn’t equip investors to conquer perhaps their most formidable foe: the fear-driven urge to cut losses.....the market is littered with winning strategies that lose their potency over time, and smart-sounding theories that fail outright when put into practice. Moreover, success in investing often leaves market-beating managers awash in fund inflows that quickly outstrip their capacity to generate ideas.

Mr. Gray responds that the research upon which his strategies are based have proved their resilience for years, and that they can be explained by investor behavior. He admits that he has considered the implications of getting too big, a state that he says isn’t imminent but could force unhappy changes on his firm.
alpha  investors  quants  USMC  PhDs  value_investing/investors  asset_management  algorithms  behavioural_economics  quantitative  idea_generation  finance  active_investing  stock_picking  investment_strategies  beat_the_market 
june 2017 by jerryking
Wall Street’s Endangered Species: The Ivy League Jock - WSJ

The industry started to shift away from athletes in the 1990s as derivatives grew in number and complexity. That necessitated a hiring spree for Ph.D.s who could understand and price them. More recently, the advent of electronic trading and quantitative investing called for many more recruits with math or computer-programming skills.
talent  athletes_&_athletics  Wall_Street  Ivy_League  quants  hiring  PhDs  trading  endangered 
may 2017 by jerryking
With 125 Ph.D.s in 15 Countries, a Quant ‘Alpha Factory’ Hunts for Investing Edge - WSJ
Updated April 6, 2017

The firm is part of the forefront of a new quantitative renaissance in investing, where the ability to make sense of billions of bits of data in real time is more sought after than old-school financial analysis.

“Brilliance is very equally distributed across the world, but opportunity is not,” said Mr. Tulchinsky, a 50-year-old Belarusian. “We provide the opportunity.”

To do this, WorldQuant developed a model where it employs hundreds of scientists, including 125 Ph.D.s, around the world and hundreds more part-time workers to scour the noise of the economy and markets for hidden patterns. This is the heart of the firm. Mr. Tulchinsky calls it the “Alpha Factory.”....Quantitative hedge funds have been around for decades but they are becoming dominant players in the markets for their ability to parse massive data sets and trade rapidly. Amid huge outflows, traditional hedge funds are bringing aboard chief data scientists and trying to mimic quant techniques to keep up, fund executives say.

Some critics of quants believe their strategies are overhyped and are highly susceptible to finding false patterns in the noise of data. David Leinweber, a data scientist, famously found that the data set with the highest correlation with the S&P 500 over a 10-year period in the 1990s was butter production in Bangladesh.
quantitative  Wall_Street  PhDs  alpha  investors  slight_edge  massive_data_sets  signals  noise  data_scientists  real-time  algorithms  patterns  sense-making  quants  unevenly_distributed  WorldQuant 
april 2017 by jerryking
Algorithms Aren’t Biased, But the People Who Write Them May Be - WSJ
Oct. 14, 2016

A provocative new book called “Weapons of Math Destruction” has inspired some charged headlines. “Math Is Racist,” one asserts. “ Math Is Biased Against Women and the Poor,” declares another.

But author Cathy O’Neil’s message is more subtle: Math isn’t biased. People are biased.

Dr. O’Neil, who received her Ph.D in mathematics from Harvard, is a former Wall Street quant who quit after the housing crash, joined the Occupy Wall Street movement and now publishes the mathbabe blog.
algorithms  mathematics  biases  books  Cathy_O’Neil  Wall_Street  PhDs  quants  Occupy_Wall_Street  Harvard  value_judgements 
october 2016 by jerryking
Wall Street’s Insatiable Lust: Data, Data, Data
Updated Sept. 12, 2016

One of his best strategies is to attend the most seemingly mundane gatherings, such as the Association for Healthcare Resource & Materials Management conference in San Diego last year, and the National Industrial Transportation League event in New Orleans.

“I walk the floor, try to talk to companies and get a sense within an industry of who collects data that could provide a unique insight into that industry,” he said.....Data hunters scour the business world for companies that have data useful for predicting the stock prices of other companies. For instance, a company that processes transactions at stores could have market-moving information on how certain products or brands are selling or a company that provides software to hospitals could give insights into how specific medical devices are being used......A host of startups also are trying to make it easier for funds without high-powered data-science staffers to get the same insights. One, called Quandl Inc., based in Toronto, offers a platform that includes traditional market data alongside several “alternative” data....
alternative_data  conferences  data  data_hunting  hedge_funds  insights  investors  exhaust_data  market_moving  medical_devices  mundane  private_equity  Quandl  quants  sentiment_analysis  unconventional  unglamorous  Wall_Street 
september 2016 by jerryking
Meet the SEC’s Brainy New Crime Fighters - WSJ
Updated Dec. 14, 2014

The SEC is mustering its mathematical firepower in its Center for Risk and Quantitative Analytics, which was created last year soon after Mary Jo White took charge of the agency to help it get better at catching Wall Street misconduct. The enforcement unit, led by 14-year SEC veteran Lori Walsh, is housed deep within the warrens of the SEC’s Washington headquarters, and staffed by about 10 employees trained in fields such as mathematical finance, economics, accounting and computer programming.

Ms. Walsh says access to new sources of data and new ways of processing the data have been key to finding evidence of wrongdoing. “When you look at data in different ways, you see new things,” she said in an interview
alternative_data  analysis  analytics  arms_race  data  data_driven  enforcement  fresh_eyes  hiring  information_sources  mathematics  misconduct  models  modelling  patterns  perspectives  quantitative  quants  SEC  stockmarkets  Wall_Street 
december 2014 by jerryking
Creativity vs. Quants -
MARCH 21, 2014 | NYT | Timothy Egan

"Creativity remains so unquantifiable, it’s still getting shortchanged by educators, new journalistic ventures, Hollywood and the company that aspires to be the earth’s largest retailer,

An original work, an aha! product or a fresh insight is rarely the result of precise calculation at one end producing genius at the other. You need messiness and magic, serendipity and insanity. Creativity comes from time off, and time out.
Aha!_moments  Amazon  contemplation  creativity  creative_renewal  genius  insanity  insights  messiness  quantitative  quants  sabbaticals  serendipity  slack_time  timeouts  under_appreciated 
march 2014 by jerryking
Keeping Up With Your Quants
July-August 2013 | HBR | Thomas Davenport.

Article places people into two buckets, as either producers or consumers of analytics. Producers are, of course, good at gathering the available data and making predictions about the future. But most lack sufficient knowledge to identify hypotheses and relevant variables and to know when the ground beneath an organization is shifting. Your job as a data consumer is to generate hypotheses and determine whether results and recommendations make sense in a changing business environment—is therefore critically important....Learn a little about analytics.
If you remember the content of your college-level statistics course, you may be fine. If not, bone up on the basics of regression analysis, statistical inference, and experimental design.

Focus on the beginning and the end.
Ask lots of questions along the way.
Establish a culture of inquiry, not advocacy.
HBR  Thomas_Davenport  massive_data_sets  data_scientists  data  data_driven  howto  analytics  decision_making  quants  questions  endgame  curiosity 
july 2013 by jerryking
The Mayor’s Geek Squad
Published: March 23, 2013

Data — or Big Data, as quantitative analysts will call it — is the tool du jour for tech-savvy companies that have realized that lurking in the vast pools of unprocessed information in their networks are solutions to some of today’s most pressing and convoluted problems. A few years ago, Google, for example, took the 50 million most common keywords that Americans typed in search bars and tried to figure out, by comparing them with federal health statistics, where the H1N1 flu virus was to likely strike next.

According to a new book, “Big Data: A Revolution that Will Transform How We Live, Work and Think,” the enormous quantity of information whirling through the ether can affect and enhance our quality of life. As the authors put it, “The change of scale has led to a change of state.”

Now the city has brought this quantitative method to the exceedingly complicated machine that is New York. For the modest sum of $1 million, and at a moment when decreasing budgets have required increased efficiency, the in-house geek squad has over the last three years leveraged the power of computers to double the city’s hit rate in finding stores selling bootleg cigarettes; sped the removal of trees destroyed by Hurricane Sandy; and helped steer overburdened housing inspectors — working with more than 20,000 options — directly to lawbreaking buildings where catastrophic fires were likeliest to occur.
massive_data_sets  New_York_City  mayoral  data_driven  targeted_enforcement  government_2.0  gov_2.0  cities  geeks  in-house  books  hit_rates  unstructured_data  H1N1  flu_outbreaks  Michael_Bloomberg  quants 
march 2013 by jerryking
School for quants
March 2, 2012 | | By Sam Knight

The Financial Computing Centre at UCL, a collaboration with the London School of Economics, the London Business School and 20 leading financial institutions, claims to be the only institute of its kind in Europe. Each year since its establishment in late 2008, between 600 and 800 students have applied for its 12 fully funded PhD places, which each cost the taxpayer £30,000 per year. Dozens more applicants come from the financial industry, where employers are willing to subsidise up to five years of research at the tantalising intersection of computers, data and money.
United_Kingdom  quantitative  Colleges_&_Universities  finance  quants  PhDs  LSE  collaboration 
march 2012 by jerryking
Fund Seeks to Demystify Quants -
APRIL 3, 2010 | Wall Street Journal | By JENNY STRASBURG.
Investors in general are suspicious of secretive strategies following
investment scams including the Madoff fraud. For Roc Capital Management,
run by 46-year-old Arvind Raghunathan who has a doctorate in computer
science, disclosing more details about investments and operations has
helped woo investors
quants  hedge_funds  India  Outsourcing  transparency  investors  quantitative  disclosure  demystification 
april 2010 by jerryking
Outsmarting The Market
JANUARY 22, 2007 | Business Week | By Anthony Bianco
alpha  strategy  quants  Wall_Street 
may 2009 by jerryking
Paul Wilmott's Financial Magazine -
September 2008 Issue | | by Bryant Urstadt

Financial whiz Paul Wilmott edits the most influential magazine you've
never heard of. He's the author of a three-volume, 1,500-page anchor of a
book called Paul Wilmott on Quantitative Finance. The latest edition
lists for $295. He has written two other books and edited about 10 more,
all of which are attempts to explain the high-level math underlying the
derivatives that have dominated Wall Street in the past decade.
quants  magazines  Nassim_Taleb  finance  corporate_finance 
april 2009 by jerryking

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