Ewan Kirk promoted systematic trading, in a Bloomberg interview, where he revealed that his quantitative hedge fund, Cantab Capital generated a 39% profit in the first quarter of 2019.
Ewan Kirk’s Cantab Capital, a 4.5 billion USD AUM hedge fund based in Cambridge, England uses computer models to drive investment decisions. Cantab Capital is staffed by a handful of mega geeks, computer scientists, mathematicians, and even physicists.
“Ewan Kirk’s Cantab Capital generated a 39% profit in the first quarter of 2019”
Ewan Kirk promoted systematic trading as a very disciplined way of investing
Systematic trading, also known as black-box trading uses computer-based algorithmic trading systems to make an investment decision.
Today’s golden goose has been displaced by the golden computer that laid golden eggs and that is how Ewan Kirk promoted systematic trading
“What we (our computer program) do is look at hundreds, maybe thousands of different securities across many years of data and invest with rules that appear to have worked in the past, and we look for the persistence of those rules that we can see that can work well” said the former Goldman Sachs alumni, Ewan Kirk who headed the investment bank’s quantitative strategies group in Europe.
The brute processing power of computers is how Ewan Kirk promoted systematic
“As a quant firm we are incredibly dependant on technology and computers are exceptionally good at doing thousands of things. So we can look across thousands of different securities and stocks and come up with rules, or models which are known to make money overtime” said Ewan Kirk.
“As a quant firm we are incredibly dependant on technology and computers are exceptionally good at doing thousands of things. So we can look across thousands of different securities and stocks and come up with rules, or models which are known to make money overtime”
“Trading can be done by computers, we have a stock portfolio of 15 hundred stocks, no human trader can handle that kind of breath” he added.
There are two camps and different ways of investing but Ewan Kirk promoted systematic trading as the evolution of trading
But Ewan Kirk admits the limitations to black-box trading.
“The biggest thing we did right was not to trust our gut and agreeing with our computers” – Ewan Kirk
“Computers can’t know everything about the stock they can’t have that gut feel and integrate everything as fast as a discretionary trader into the models. There are two camps and different ways of investing;” said Ewan Kirk.
“The biggest thing we did right was not to trust our gut and agreeing with our computers” he said.
But Ewan Kirk admitted that systematic models don’t work all the time, like all investment styles they have their ups and downs.
“If you can’t see what you are doing statistically wrong then you are unlucky wrong.
Quants went through a period of bad luck rather than being broken forever.
We should be allowed to have periods of bad luck” said Ewan Kirk.
Ewan Kirk promoted systematic as a technical way of following a traditional momentum trading strategy
“It is right to chase those trends for a certain period and what has worked for the last six month for most systematic traders is that oil dropped by 50%, interest rates continued going down, bonds continued going up and the dollar strengthened dramatically” he said.
But chaos theory, black swan events don’t mix well with a systematic trading strategy, see the Ewan Kirk promoted systematic interview.