Writing for Firstlinks (formerly Cuffelinks), Redpoint’s CEO Max Cappetta discusses the what and why of quantitative investment.

The essence of a quantitative investment approach is straight-forward: it is the utilisation of rational economic and fundamental investment insights in a disciplined and consistent fashion.

Of course, all investment managers use quantitative tools in various ways. Many use simple screens to help focus their detailed research on a smaller set of companies. This is especially important when managing global portfolios. The detailed research element often includes modelling a company’s financial statements and company visits to gain a deep stock specific perspective. The final step is then to incorporate the research insight into portfolios to meet both risk and return objectives.

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Tracey Franks GSFM Adviser

The views expressed are her own and do not consider the circumstances of any investor.