Quantitative Investing Introduction
Quantitative investing is a systematic and structured form of investing that relies on mathematical models to make decisions. This is opposed to discretionary investing, which on the other hand is based on subjective assessments. Quantitative investing relies on statistical models that incorporate clearly defined metrics that can be derived from data. This enables the quantitative investor to run back-test, additional analysis or even implement an automated system. In addition to that, quantitative systems can be applied to all kinds of financial instruments. For all these reasons, quantitative trading and investing are at the forefront of financial research, and the professionals that design and implements quantitative models (so-called “quants”) are employed by banks, hedge funds, prop trading firms, just to name a few.