Unpacking Market Expectations and the Role of Surprise in Returns

This chapter explores how market expectations are shaped by unexpected elements that affect investment returns. It underscores the role of machine learning in identifying these unknown factors while advocating for a fundamentally driven approach to assess market dynamics.

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Episode notes

Trey Lockerbie explores the evolution of Quant investing with Jonathan Briggs. Jonathan holds a Ph.D. in Mechanical Engineering and Applied Mechanics from UPenn and has had a long career of researching and developing investing techniques for pension funds, such as the CPP Investment Board. He is now CIO of his own fund, Delphia, where they are implementing techniques developed from his research.

IN THIS EPISODE, YOU’LL LEARN:

08:16 - The basics of quant investing.
15:54 - The commoditization of the approach has led to a “Quant Winter”.
18:52 - How size and scale applies to the strategies.
47:39 - How machine learning is playing a bigger role in the quant approach.
1:02:03 - The economic framework Jonathan has devised after decades of research.
And much much more!

*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.

BOOKS AND RESOURCES

Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, and the other community members.
Delphia Website.
Active Portfolio Investing Book.
Asset Pricing Book.
Trey Lockerbie Twitter.

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