Quant and computer driven hedge fund biggest winners after Brexit
All according to Bloomberg
Here are some articles to prove my point in how both quant and computer driven (automated) trading firms will do best after this Brexit fiasco:
Hours after Britain’s decision to leave the European Union sparked mayhem across global financial markets, a handful of prescient investors began to emerge as big winners.
To read the entire article, go to http://bloom.bg/295Wqi9
Short of making a directional bet, hedge funds that employ computers to follow trends also did well. Aspect Capital’s flagship $797 million Diversified Fund was up almost 4 percent on the day as of mid-afternoon, the $2.5 billion Cantab Capital Partners Quantitative Fund rose more than 3 percent, and the $12.8 billion Winton Futures Fund gained about 2 percent, according to people with access to initial return estimates for the funds.
Spokesmen for Cantab, Winton and Aspect declined to comment.
“This is the winning strategy in this troubled environment,” said Philippe Ferreira, head of research at Lyxor Asset Management. “This is typically an environment conducive for hedge funds who can trade the higher volatility and outperform traditionalmarkets.”
Anthony Lawler, a money manager at GAM Holding AG in London who tracks hedge-fund performance, said such funds were making money from their bets that U.S. Treasuries, European sovereign fixed income and the U.S. dollar would rise in value, while the energy sector and pound would face a sell-off.
One way to assess how much pain looms for global stocks post-Brexit is to figure out who needs to sell. Strategists analyzing fund flows say that includes computer traders, exchange-traded funds and individuals who piled into European stocks expecting a different outcome. Societe Generale Global Strategist Kit Juckes discusses with Bloomberg’s Anna Edwards on “Countdown.”
One way to assess how much pain looms for global stocks post-Brexit is to figure out who needs to sell. Strategists analyzing fund flows say that includes computer traders, exchange-traded funds and individuals who piled into European stocks expecting a different outcome.
To read the entire article, go to http://bloom.bg/29aOFrb
An additional $100 billion in automated sales will hit over the next few days, with $40 billion coming from volatility targeting, $40 billion from trend-following strategies and as much as $30 billion from risk parity funds, which try to balance exposure across asset classes, according to Kolanovic. The sales could end up totaling closer to $300 billion, depending on how realized volatility responds to recent stock market shocks, his note said.
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