Odd Lots Giuseppe Paleologo on Quant Investing at Multi-Strat Hedge Funds
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Jun 21, 2025 
Giuseppe Paleologo, Global Head of Quantitative Research at Balyasny Asset Management and author of 'The Elements of Quantitative Investing', delves into the world of quantitative investing, clarifying its complexities. He discusses the rise of quant strategies versus traditional methods, the nuances of factor identification, and the evolving roles within hedge funds. Paleologo also touches on the integration of AI in optimizing investment approaches, spotlighting the challenges of adapting to changing market dynamics and the significance of proprietary data for enhancing trading strategies.
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What Defines Quant Investing
- Quantitative investing involves making many independent bets scaled across assets or frequencies.
- It's not just using numbers, but executing numerous bets systematically to be truly quantitative.
Role of Quant Research Head
- Gappy Paleologo leads quantitative research for equity strategies at Balyasny Asset Management.
- His team develops factor models, hedge portfolios, and advises portfolio managers including performance and risk management.
Characteristics of True Factors
- True factors are pervasive, persistent, and interpretable systematic sources of return across assets.
- Themes like AI or political factors lack persistence and diversification to be considered true factors.
