Hedge Fund Generates 34% Return Using Just AI And Machine-Learning
by Wed, 06/24/2020 - 14:10
Ever since the advent of active asset management, Wall Street has had two holy grails: finding a consistent source of Alpha (which these days simply means frontrunning the Fed), and finding a replacement to the most expensive cost-center in the asset management industry: analysts. And while many have tried and failed to replace (highly paid) humans, an obscure German hedge fund is appears to have struck gold after generating a 34% gain in 2020 using a machine-learning program targeting need-for-speed markets.
What he actually means is that with the "market" now a mandated policy vehicle targeting 10-year-olds, where retail daytraders outperform career finance professionals, it is hardly a surprise that some coked-up algo which accentuates the market's wild swings has been successful at outperforming the market. What is left unsaid is all the other algos that have blown up over the years trying to do just that.