The quantitative investment industry will penetrate deeper into previously unpopular markets, such as Company debt and Private propertyAccording to Sandy Rattray of the Man Group, it changed the field dominated by human financiers.
Chief Investment Officer of UK Hedge Fund, retire After working in this industry for three years, later this year, he believes that despite the ups and downs of his career, “quantitative investors’ invasion of fund management is unstoppable.”
Latre said that in the next ten years there will be quantitative analysts who use computer-driven models of data and systems to make investment decisions and occupy more areas in the financial sector that has been considered for a long time. Treacherous terrain For algorithm strategy.
“Almost every sector of the market has become more quantitative, and this situation may continue. There are some persistence, but they will eventually decline,” he said in an interview with the Financial Times. “People in the financial world seem to think it’s special to some extent, but it’s just another industry, and all industries will become more technology and data-driven.”
The jewel in the crown Men’s Team It is its systematic, computer-driven AHL unit, and its assets under Rattray’s management have climbed from US$11.9 billion as CEO at the end of 2013 to US$50.7 billion this year. In 2017, he was appointed as the Chief Information Officer of Man Group, helping the total assets under management of the group reach a record 135 billion U.S. dollars.
Rattray joined Man in 2007. Prior to that, he was one of Goldman Sachs’ top equity derivatives strategists. There, he led a comprehensive reform of the Vix Volatility Index to create derivatives based on the “fear indicator”. This makes him one of the most well-known figures in the industry. “Sandy is a quantitative analyst,” said Mark Anson, the head of Commonfund, a non-profit investment group that manages $26 billion in assets on behalf of foundations and charities.
One of the biggest changes in Rattray’s career has been the speed and cost of transactions, and the broader The investment industry adopts more quantitative methods“Twenty years ago, if you talked to a fund manager about a yield factor, they would treat you as if you had two heads,” he said, referring to one of the many data that quantitative funds put into their investment decisions. . .
In the future, the two financial sectors will feel the invasion of Quanke will be Corporate bond market Rattray predicts—systematic strategies are now beginning to spread—and private equity.
“If I have time, I think it would be a good choice to become a quantitative analyst in the private equity field. Private equity has always been a strong supporter of technology companies, but they are as non-technical as you can imagine in their own companies. Proficient,” he said.
Man’s retiring CIO believes that private equity investment may be massive and it is almost impossible to systematize the untraded market, but the acquisition industry can still learn a lot from the quantitative world.
“By letting algorithms do it, you can free private equity managers from the many manual and boring things they do, such as modeling companies, obtaining peer data, or analyzing industry trends,” he said.
An example of this is a large database created by Man Group, which maps Company’s business-to-business relationship All over the world, so it can see how news spreads throughout the supply chain. “This is very useful in the open market and very useful in the private market,” Latre said.
Regarding the quantitative industry itself, he believes that the next major frontier will be how good it is to improve Machine analysis text, Instead of just numbers, and using the potential power of machine learning, this is another area of artificial intelligence.
Latre pointed out, Text data volume With explosive growth, machines are gradually getting better at screening profitable trading models. “They did a great job today, but the next frontier is that they become very good at it,” he said. “Machines cannot read bond brochures like humans. But they may eventually get there, and when they arrive, the good news is that they will never get tired or tired of reading.”
Machine learning has always been one of the most hyped areas in the financial world, and Latre admits that Man Group has had successes and failures in this area.Its machine learning strategy is Covid-induced market turmoil Last year, but he still “absolutely believe” that it will play an important role in future investments.
“What brought us to this point is a very simple linear model, and the market is not linear,” he said. “I think there is room for better models, but usually it is a big step forward and then there will be problems.”
Since Rattray began his career, another area that has fundamentally changed is how people with scientific and computer backgrounds are paid compared to wealthy investment bankers and traders. “Thirty years ago, the income of quantitative analysts was not high, but now their income is very high,” he pointed out.
Nevertheless, Latre left his position to pursue a degree in architectural history and cultivate his passion for Scandinavian modernism. “This is a way of extending my thoughts in different directions,” he said. “I don’t know what I will do after that. If I lack imagination, I may eventually return to the financial industry, but this is not a plan.”