Crowding can be good for quants (sometimes) – Goldman

Study finds timing dictates different results for convergent and divergent strategies in herd moves

Goldman-Sachs-headquarters.jpg
Goldman Sachs is “exploring using crowdedness indicators as signals for timing different alternative risk premia strategies”, says head of R&D

It’s been the big fear plaguing quant managers for years, but crowding – when investors follow similar strategies and buy and sell the same assets in sync – isn’t always bad for systematic investors, according to a study from Goldman Sachs.

Heavy cashflows into quant strategies such as alternative risk premia have pricked concerns about what could happen if investors ditched assets in unison when those strategies stumble. The extra investment has also added to worries that some strategies are

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe

You are currently unable to copy this content. Please contact info@risk.net to find out more.

Sorry, our subscription options are not loading right now

Please try again later. Get in touch with our customer services team if this issue persists.

New to Risk.net? View our subscription options

Register

Want to know what’s included in our free membership? Click here

This address will be used to create your account

You need to sign in to use this feature. If you don’t have a Risk.net account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here