Frequently Asked Questions

 Systematic investing, also known as quantitative investing, is a data-driven approach to investing that uses computer modeling, scientific testing, and alternative data to build portfolios. It's a way to make investment decisions in a consistent and rigorous manner. 

Reliability & Repeatability – Quantitative methods intensify the use of data and models to reduce reliance on individual biases, preferences and ad-hoc analysis.

Transparency – The mathematical operations and models that power most quantitative methods can be complex, but their outputs are straightforward, transparent, and decisions are easier to communicate.

Capital protection – Quantitative methods can rigorously enforce diversification and capital protection mandates starting from portfolio construction and flowing all the way through to risk exposure management and trading operations.

Risk management – Models can consistently monitor and quantify risks as they emerge and execute appropriate trading to provide enhanced risk management.

Potential drawbacks include the possibility of investing in underperforming assets due to rigid adherence to rules, lack of flexibility to adapt to changing market conditions, and the potential for higher transaction costs if not managed carefully.

 Systematic investing is more rule-based and consistent, while discretionary investing involves making decisions based on market conditions, personal insights, or individual preferences. Systematic investing aims for consistency, while discretionary investing can be more flexible but potentially more emotional.

 Systematic investing can lead to more consistent long-term returns by reducing the impact of market timing errors and emotional decision-making. It helps investors stick to their plan and benefit from the power of compounding over time.