You know that part in a movie when the guy won’t talk. Maybe it’s a good guy who’s finally been caught by the bad guys in the big black SUVs. They’ve tied him up, knocked him about, perhaps threatened his family, nothing. Or maybe it’s a bad guy down at the precinct and they’ve just done the good-cop-bad-cop routine. Either way, when they’ve tried everything and he still won’t talk, there is that always that one person who is their final recourse. If anyone is going to make the guy talk, it’s going to be him. Often he looks the part too. Big and burly, perhaps muscular and with a mean mug. Something about him freaks you out, but you can’t say what exactly, or why. Besides looking the part, he also acts the part. He might come in cracking his knuckles, or with a special toolbox. Maybe he pulls down the blinders to show that whatever he is about to do is unsightly.

That’s the sort of person I like to think of myself as when I analyze data. I will torture1 it if I have to, but it will talk, and reveal any important information that could be of use to our cause. This is where I will be bringing my findings.

Welcome to my Sub.

The motivation behind it is that most traders and investors don’t have enough time, and sometimes know-how, to do the quantitative analysis needed to answer some of their questions about markets. Institutional traders and their ilk probably do, but that research is often private or paywalled. So I believe there is room for some Subs that crunch the data for everyone else. My edge in this venture is that I went to actual Quant school, have taught myself a bunch of useful stuff, have 4 years experience as a freelance quant and data analyst, and I thoroughly enjoy the process of analyzing data. I’m in a great position to use various models and techniques to uncover helpful information for traders and investors. That’s my value proposition.

My focus is on usefulness. I have a lot of interesting ideas that would be fun to try out. But I would like to focus on the ones that satisfy everyone’s curiosity instead of just my own, and more importantly, the ones that can make people money, or prevent them from losing a lot of it2. In every single post, the question I will be looking to answer is simply: “Can this make people money or not?” Based on my observations and studies3, the best way to make money in the markets is to avoid losing a lot of it, and then bid your time. Thus hedging efforts can sharpen one’s edge, ergo the name Quantitative (h)Edge.

As always, remember:

“All models are wrong, but some are useful.” - George E. P. Box

“The precise market mechanism that links news to price, cause to effect, is mysterious and seems inconsistent. Threat of war: Dollar falls. Threat of war: Dollar rises.” - Benoit Mandelbrot, The Misbehavior of Markets

kthxlet’sgo!