{"id":2936,"date":"2019-07-12T21:11:29","date_gmt":"2019-07-12T13:11:29","guid":{"rendered":"https:\/\/www.investagrams.com\/daily\/?p=2936"},"modified":"2019-07-12T21:15:51","modified_gmt":"2019-07-12T13:15:51","slug":"what-is-quantitative-trading","status":"publish","type":"post","link":"https:\/\/www.investagrams.com\/daily\/2019\/07\/what-is-quantitative-trading\/","title":{"rendered":"What is Quantitative Trading?"},"content":{"rendered":"<p>In today\u2019s continuously evolving world, the ways of trading the financial markets have modernized as well. Back in the 1950s, you had to trade on the floor of the exchange and scream at the top of your lungs to get your orders filled. In the early 2000s (the Internet Era), that\u2019s when trading off the floor became the norm. Instead of having to be on the floor of the exchange, all you needed was a computer to trade at the comfort of your own home or personal office.<\/p>\n<p>In recent times, the new norm adopted by higher level investors is <span style=\"text-decoration: underline;\"><strong>Quantitative Investing<\/strong><\/span>. This is the use of proprietary models to increase the probability of out-performing the general market. Most quant models work well when backtested thoroughly, but still face the same risks any strategy would. However, the main reason quants based investing models work is because they are based on discipline. Also, a quantitative model is not biased; it chooses to go where the opportunities lie, whether short or long.<\/p>\n<p>So, is Quantitative Trading or Quants only for the high level fund managers handling millions of dollars in assets? We believe that the answer is <strong>no<\/strong>. It is possible for a retail investor to take advantage of Quantitative Investing, but it\u2019s not easy, given the limitations of any retail trader. We interviewed Ethan Matthews, a New-York based currencies and equities trader, to share his experience in learning about Quants.<\/p>\n<p>We first asked Ethan why he wanted to learn about Quants in the first place. He said, \u201cI started becoming interested in Quantitative Trading in late 2017 to see how this could take my trading to the next level. I\u2019m the type of person who wants to latch on to today\u2019s innovate ways of doing things. And at this point in time, quants was an innovative way to trade the financial markets. I looked at the idea of trading on purely Quantitative data as a way for me to focus more on other aspects in life such as my family.\u201d<\/p>\n<p>Ethan also shared how in the early stages of his trading, he had difficulties staying disciplined on his chosen approach. \u201cI was a know-it-all when I just began. I had a system, but I still made discretionary decisions. The system was only a mental setup, a specific chart pattern I wanted to see before I committed my money to a specific trade. However, there were times when I didn\u2019t take on the trade despite the signal, or when I took on a trade that was not part of my setup.\u201d He sees Quantitative Investing as a way to remain disciplined on a specific approach since Quants help realize the probabilities in one\u2019s favor.<\/p>\n<p>When asked about his learning phase, he answered \u201cI have to admit that learning and applying Quantitative Trading to trade my strategy is no easy task. Especially coming from a business background, there\u2019s a specific learning curve before you can start implementing your parameters for the program to detect. What\u2019s more is that different parameters would require different codes, which I have to learn every time before I see backtested results. But at the end of the day, just like any investment, it was worth it. Now I get trade signals when my proven strategy shows an entry signal, and what\u2019s more is that I can now dedicate more time improving my edge. I do not have to watch the markets all day.\u201d<\/p>\n<p>The last question we asked Ethan was, Do you believe Quantitative Investing can only be used by fund managers or institutional investors? He responded, \u201cAbsolutely not! Some people still think until this moment that the financial markets are only for those who have a ton of money. While some retail investors think that they are no match for the institutional investors. First of all, retail investors have a huge advantage when it comes to liquidity and freedom of choice on what to buy. Also, even retail traders can take advantage of Quants if they are willing to do the homework. Quantitative Investing is not simple, but it can do wonders for you if you make a commitment to the strategy.\u201d<\/p>\n<p>Most traders have heard of quantitative trading, and never bothered to learn more, due to the \u201climitations\u201d of retail traders. It\u2019s something most of us wish we could learn, but never got the opportunity or the push to get us started. While most of us struggle with the psychological aspect of trading, the answer has always been right around the corner.<\/p>\n<p>Which is why this July 27, 2019 at the <a href=\"https:\/\/www.investagrams.com\/tradersSummitSG\">Investagrams Traders\u2019 Summit<\/a>, we are breaking barriers for you to get started in your own quantitative model. Learn from <span style=\"text-decoration: underline;\"><strong>Jake Chow<\/strong><\/span>, a Chartered Market Technician and a professional in Quants Investing, as he jumpstarts your Quants journey.<\/p>\n<hr \/>\n<p><a href=\"https:\/\/www.investagrams.com\/tradersSummitSG\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-2918 size-full\" src=\"https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3.jpg\" alt=\"\" width=\"1258\" height=\"614\" srcset=\"https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3.jpg 1258w, https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3-300x146.jpg 300w, https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3-768x375.jpg 768w, https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3-1024x500.jpg 1024w, https:\/\/dailymedia.investagrams.com\/investadaily\/2019\/07\/Speaker-Poster-Platform-3-610x298.jpg 610w\" sizes=\"auto, (max-width: 1258px) 100vw, 1258px\" \/><\/a><\/p>\n<div style=\"margin-top: 0px; margin-bottom: 0px;\" class=\"sharethis-inline-reaction-buttons\" ><\/div><div style=\"margin-top: 30px; margin-bottom: 50px;\" class=\"sharethis-inline-share-buttons\" ><\/div><span class=\"et_bloom_bottom_trigger\"><\/span>","protected":false},"excerpt":{"rendered":"<p>In today\u2019s continuously evolving world, the ways of trading the financial markets have modernized as well. Back in the 1950s, you had to trade on the floor of the exchange and scream at the top of your lungs to get your orders filled. In the early 2000s (the Internet Era), that\u2019s when trading off the [&hellip;]<\/p>\n","protected":false},"author":3,"featured_media":2937,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"cybocfi_hide_featured_image":"","footnotes":""},"categories":[42,37],"tags":[],"class_list":["post-2936","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-featured-3","category-news-features"],"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/2936","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/comments?post=2936"}],"version-history":[{"count":3,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/2936\/revisions"}],"predecessor-version":[{"id":2940,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/posts\/2936\/revisions\/2940"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/media\/2937"}],"wp:attachment":[{"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/media?parent=2936"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/categories?post=2936"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investagrams.com\/daily\/wp-json\/wp\/v2\/tags?post=2936"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}