Aaron Brown, Columnist

Here’s How the Quants Might Pick NCAA Basketball Winners

The same principles of factor investing can be applied to March Madness brackets.

March 19, 2019 at 1:00 PM UTC

Corrected

March 20, 2019 at 12:18 AM UTC

Aaron Brown is a former head of financial market research at AQR Capital Management. He is also an active crypto investor, and has venture capital investments and advisory ties with crypto firms. He is the author of the soon-to-be-released "Wrong Number."

It’s time for some March Madness. — It’s time for some March Madness.
Photographer: Michael Heiman/Getty Images North America

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This week marks the start of the NCAA’s 68-team, single-elimination tournament to select the men’s basketball team champion. There is a women’s version as well, but the men attract most of the betting interest. Workplaces across the country are creating “bracket pools” with entry fees from $1 to $10,000 where bettors try to predict the results.

I’m going to demonstrate a powerful quant technique — factor investing — to pick a winning NCAA bracket. Skip lower for the picks, but if you have patience, I’ll show interesting things along the way.