Quantitative analysis
Also called: quant analysis, quantitative investing
Making investment decisions with data, statistics and precise rules, tested on past data and checked on data not used to build them.
The workflow runs from hypothesis to data, rules, backtest and out-of-sample test. The main dangers are overfitting, survivorship and look-ahead bias, and ignoring costs. Simple models with a clear rationale tend to hold up better than complex ones.
Learn more in these lessons
- Quantitative analysisHow do quantitative analysts build and test models, and where do they go wrong?
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