The quant model eliminates the involvement of human emotion and sentiment while buying and selling stocks. This fund restricts the choice of stocks based on the model. The buy and sell decisions are given based on academically researched and complex decision-making systems. The quant system behind this fund selects the best available stock option that is likely to generate a good future return.
This fund makes use of the latest technologies such as data science and AI to process and analyze large data in generating meaningful information. The large diverse data & information are stored at the backend computational system of this fund. Quant Mutual Fund works on the predefined algorithms and historical data. This fund has a similar risk profile of the thematic fund.Īlso Read – Thematic Funds, Sectoral Mutual Funds – Good for Investment? How Quant Mutual Fund Works? However, as these funds work on historical data and artificial intelligence it cannot handle unprecedented events. The followers of the quant fund say that the scope of human error in this fund is very less and almost negligible hence these type of fund is likely to perform better.
Quant fund models are based on back-tested data. The predictive model is known as the quant fund model.
#QUANT FUND SOFTWARE#
The decision is taken by software programs that are based on predictive models, hidden patterns, statistical techniques, and quantitative analysis. The investment decision in this fund is not taken by a human being.
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