At 6PM of April 10th, financial seminar “Is quantitative investment from Wall street perfect” was successfully held in Room S102 at ZhongGuanCun campus of UCAS. This seminar was the 12th one of financial seminar series at School of Economics and Management of UCAS. The speaker is Dr. Wang Zhen, co-founder and CIO of Beijing Caijing Information & Technology C o. ltd. Deputy Director of MBA center, associate Prof. Yan Yan chaired the seminar.
At the beginning of the seminar, Dr. Wang Zhen introduced the history and development of quantitative investment in mature capital market in Europe and America combining his working experience in the United States. Then, He explained the specific meaning and basic content of investment using the interesting proposition that S & P 500 index itself was a quantitative investment strategy. He pointed out that quantitative investment was a systematic methodology. This methodology used modern finance, mathematics, computers and other professional knowledge to transfer investment philosophy, scientific theory and actual data quantization to objective quantitative model, and used computers to complete all or part of a transaction. A quantitative trading strategy design was driven by original data, through capturing the excess income factors, risk control and other steps. It was a process of generating a series of combination strategies and transaction, which was significantly different from high-frequency trading and arbitrage strategies in the market. Dr. Wang Zhen further explained advantages and disadvantages of quantitative investment as a method of investment by giving examples like LTCM bankruptcy, London Whale events in history. He also pointed out that it was difficult to avoid “black swan” event because of the observation data bias, model assumption and construction error.
Then, Dr. Wang Zhen divided existing quantitative investment methods into two categories: P-Quant and Q-Quant, and carefully introduced their main objectives, theories and methods, and their respective requirements for practitioners. Dr. Wang Zhen then gave an analysis on prospects of the quantitative investment at home and broad combing his own company experience. He pointed out that the scale of asset management applying quantitative investment in China was less than 1%, which was far behind the development in the United States, which was 30% a few years ago. Therefore, there will be a huge market potential and talent demand.
Finally, Dr. Wang Zhen prospected the development trend of quantitative investment. He said that it was difficult for current wealth management companies to keep up human resource with the growth rate of the market, the escalation of the high net worth individuals wealth growth and investment demand. Part of the work will be replaced by machine in the future as Citigroup, Deutsche Bank and other large international institutions have been strategically explored and laid out their business in this area.
At the end of the seminar, Dr. Wang Zhen showed the audience the achievement his company had made, which won a lot of praises. He also carefully answered the questions asked by the audience. The seminar was successfully held.
