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Quants Are Back Making Money on Factor Trades Like Good Old Days

  • Dethroning of mega-cap stocks is boosting systematic styles
  • Factors like value and low volatility are rising in tandem

The worst year for stocks since the global financial crisis is bringing back the good old days for a once-revolutionary breed of quant investor who took a big beating in the cheap-money era.

Machine-powered funds that slice and dice equities on their traits like how cheap they look or how fast they’ve risen -- known as factor investing -- are making money time and time again this year, while the likes of discretionary hedge funds and speculative day traders crater in the market crash.