10 Biggest Quant Funds in The World, 10 Stock Picks
Quant hedge funds saw massive losses in 2020 as machine powered strategies failed to accurately predict the unprecedented market trends. Quant equity hedge funds mainly struggled due to the introduction of new market trends in the pandemic year, which have no previous precedent. This is contrary to quantitative trading strategies that study a large amount of historic data to predict future trends. Quant hedge funds are blaming increased volatility for hefty losses.
Volume, price, and historical data are among the big factors when it comes to quantitative analysis.
“If nothing else, it’s clear that 2020 represents an Achilles’ heel in the hedge fund machines, namely a real failure to grapple with unique new drivers of stock returns that don’t fit the academic models. Even the newer ‘machine learning’ approaches felt somewhat impotent since you need to learn from something, and probably rack up losses while you’re lea
Human-Run Hedge Funds Trounce Quants in Year Defined by Pandemic
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Synopsis
After years of being outgunned and outclassed by computer-driven quantitative strategies, human stock-pickers climbed back on top in 2020.
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At the same time, macro managers, many of whom have complained about years of low volatility, finally got what they wanted.
By Hema Parmar, Katherine Burton and Nishant Kumar
Turns out, the hedge fund industry’s swashbucklers haven’t been made obsolete by the machines just yet.
After years of being outgunned and outclassed by computer-driven quantitative strategies, human stock-pickers climbed back on top in 2020. The dizzying gyrations of the pandemic-stricken year humbled even the most sophisticated of quants notably behemoths Renaissance Technologies and Two Sigma whose trading models were thrown off by swings their computers had never seen before.
It’s been a good 2020 for John Thaler, who decided to stage a comeback in January after shutting down JAT Capital in 2015.
After delivering eye-popping returns so far this year, Thaler’s new firm, Hampton Road Capital Management, is forming a strategic relationship with Leucadia Asset Management, the asset management division of Jefferies Financial Group. Leucadia will invest capital in Hampton Road’s long-short equity strategy, which is focused on technology, media, telecommunications, and consumer sectors globally.
According to an investor letter distributed early Friday and obtained by
Institutional Investor, Hampton Road is up 39.4 percent net year-to-date through December 10. The fund has garnered $250 million in assets under management so far, according to sources.
Leucadia Asset Management Announces Strategic Relationship with Hampton Road Capital Management
Leucadia Asset Management, the asset management division of Jefferies Financial Group Inc. (NYSE: JEF), today announced a strategic relationship with Hampton Road Capital Management LP ( Hampton Road ), a fundamental long/short equity firm focused on investing in the technology, media, telecom ( TMT ) and consumer sectors globally. In connection with the transaction, Leucadia Asset Management will invest long-term capital into Hampton Road s long/short equity strategy.
Based in Greenwich, CT, Hampton Road, led by Founder and Portfolio Manager John Thaler, began trading its strategy in January 2020. Thaler is a veteran, global TMT investor with more than 20 years of experience investing both publicly and privately. He previously was the Founder and Portfolio Manager at JAT Capital, a $3 billion TMT-focused hedge fund Thaler founded in 2007. Prior to JAT, he was a Portfolio Manager at $8
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