Investment flow tracking is next ‘frontier’ in unlocking alpha
Risk Live: Flows impact asset prices more than widely believed and may be more predictable – quants
In the future, systematic investors will rely less on the fundamentals- and price-based ratios they have traditionally used and focus more on tracking investment flows, according to quantitative investing specialists.
“The [new] frontier for quant investing is not just doing value [investing] with price multipliers or price ratios but seeing who is buying or selling,” said Xavier Gabaix, a finance professor at Harvard University.
“If you have these disaggregated flows, you can predict the
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