Quantedge vs Other Investment Managers Compared

Quantedge stands out from other investment managers in several key areas. Its unique approach to quantitative investing has allowed it to achieve significant returns with lower volatility.

Quantedge's track record is impressive, with a 10-year annualized return of 17.4% compared to 12.2% for the global equity market. This is a testament to the effectiveness of its investment strategy.

One key factor contributing to Quantedge's success is its focus on absolute returns rather than benchmark-based performance. This allows the firm to take a more flexible approach to investing, making it better equipped to navigate market downturns.

Quantedge's ability to generate alpha through its quantitative models is a major advantage over other investment managers. Its models are designed to identify high-quality stocks with strong growth potential, resulting in higher returns for investors.

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Quantedge employs a systematic investment strategy that uses statistical models to invest across major macro asset classes. This approach helps to identify market inefficiencies and generate alpha.

The fund has an investment universe of more than 200 instruments and typically invests in more than 90% of these instruments, resulting in an exceedingly diversified portfolio. This diversification helps to enhance the overall portfolio's risk-adjusted returns.

Quantedge uses dynamic asset allocation to overweight more attractive instruments and underweight less attractive ones. This strategy helps to optimize returns and minimize risk.

The fund targets a constant level of total risk, which approximates to 25% annualized volatility. This means that the fund is designed to be relatively stable, with a moderate level of risk.

Quantedge does not employ short-term day-trading strategies; instead, it holds its positions for weeks to several years. This long-term approach helps to reduce trading costs and increase potential returns.

Here is a summary of Quantedge's investment strategy:

Quantedge's impressive track record has earned it a spot among the most successful hedge funds globally. The firm's Quantedge Global Fund has delivered roughly +20% annual returns after fees since its launch in October 2006.

The fund's consistency is a notable aspect of its performance, with positive returns for most years since inception. It's worth noting that 2008, 2015, 2018, and 2022 were the only years with negative returns, with losses of -23%, -18%, -29%, and -21% respectively.

The fund's largest annual gains were in 2010 and 2019, with returns of 82% and 70% respectively. These outsize returns set the firm apart in the hedge-fund industry.

Here's a breakdown of the fund's annual net returns:

The fund's exceptional performance has earned it recognition among top rankings by various organizations, including AsiaHedge, Bloomberg, and Barrons.

Quantedge targets a high level of total risk for its portfolio relative to other hedge funds.

The fund expects to experience a 10% to over 40% loss periodically as part of its strategy.

This means investors can expect to see significant fluctuations in their returns.

During the 2008 financial crisis, Quantedge experienced a 45% drawdown before ending the year with a narrower 23% loss.

Investors who can't handle short-term volatility should look elsewhere.

In March 2020, Quantedge experienced its largest monthly decline of 29%.

To invest with Quantedge, you need to understand its strategy and be able to tolerate high levels of short-term volatility.

Investing for the long term is essential to ride out the fund's periodic losses.

Quant hedge funds like Quantedge differ significantly from traditional ones in their approach. They rely on statistical models and algorithms, whereas traditional hedge funds rely on fundamental analysis and human decision-making.

Quant funds trade more frequently, allowing them to quickly analyze vast amounts of data. This approach enables them to make rapid decisions.

Professionals with strong backgrounds in mathematics, statistics, and computer science are often employed by quant funds.

Quantedge made the Bloomberg list of hedge fund giants in an article published on July 12, 2024. The list featured Quantedge Global Master Fund alongside other well-renowned peers.

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Quantedge has a track record of almost 18 years of market-beating returns, averaging 20% net annualized returns since inception. This aggressive compounding would lead to a day-one investor growing each dollar invested 23 times.

The article describes these funds as getting off to one of the best starts to a year, aided by stocks and quantitative investing. Quantedge invests in close to 300 different markets within its ultra-diversified quantitative investment portfolio.

The fund's dynamic asset allocation approach involves re-evaluating the attractiveness of strategies daily and rebalancing daily. As of the end of July, Quantedge was up +17%, with gains largely coming from currency long-shorts, equity risk premia, and equity long-short strategies.

Suhaimi Zainul-Abidin, CEO for Quantedge Capital, mentioned that the fund had a good year in 2023, making 30% on the back of tailwind on equities risk premia and commodity long-short bets.

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