INVESTOR SERIES The Answer: Trend Chasing and Momentum Trading Bonus: Arbitrage Trend chasing and Momentum Trading The most popular quant strategies involve trend chasing and momentum trading. Traders who design trend-chasing algorithms use the technical indicators of moving averages and strength indicators. Trades are executed based on trends that follow set parameters. This is a … Read more
INVESTOR SERIES In June 2022, the S&P 500 entered a bear market for the first time since March 2020. Question: What defines a bear market? Fact: Wall Street uses the “bear market” term to describe a sustained period when the equity markets are down at least 20% from their recent peaks. Question: When was last … Read more
INVESTOR SERIES Question: What do hedge funds actually do? Fact: A hedge fund is an investment vehicle for high-net-worth individuals, institutional investors, and other accredited investors. The term “hedge” is used because these funds historically focused on hedging risk by simultaneously buying and shorting assets in a long-short equity strategy. Question: Are Mutual funds considered … Read more
101 SERIES Mathematical finance, also known as quantitative finance and financial mathematics, is a field of applied mathematics, concerned with mathematical modeling of financial markets. There are two separate branches of finance that require advanced quantitative techniques: 1. Derivatives pricing 2. Risk and portfolio management. Mathematical finance focus in within the fields of computational finance … Read more
101 SERIES A quantitative fund is an investment fund that uses quantitative investment management instead of fundamental human analysis. Note: Quantitative analysis is the use of mathematical and statistical methods in finance and investment management. Investment process The process is classified as quantitative when investment management is fully based on the use of mathematical and statistical methods to make investment decisions. If investment decisions … Read more
What Is an Economic Cycle? The term economic cycle refers to the fluctuations of the economy between periods of expansion (growth) and contraction (recession). Factors such as gross domestic product (GDP), interest rates, total employment, and consumer spending, can help to determine the current stage of the economic cycle. Understanding the economic cycle can help investors and … Read more
What Is an Economic Cycle? The term economic cycle refers to the fluctuations of the economy between periods of expansion (growth) and contraction (recession). Factors such as gross domestic product (GDP), interest rates, total employment, and consumer spending, can help to determine the current stage of the economic cycle. Understanding the economic cycle can help investors and … Read more