Quant trading: How mathematicians rule the markets

Tuesday, September 27, 2011
By Paul Martin

By Richard Anderson
BBC.com

Trading floors were once the preserve of adrenalin-fuelled dealers aggressively executing the orders of brokers who relied on research, experience and gut instinct to decide where best to invest.

Long ago computers made dealers redundant, yet brokers and their ilk have remained the masters of the investment universe, free to buy and sell wherever they see fit.

But the last bastion of the old order is now under threat.

Investment decisions are no longer being made by financiers, but increasingly by PhD mathematicians and the immensely complex computer programs they devise.

Fundamental research and intuition are being usurped by algorithmic formulae. Quant trading is taking over the world’s financial capitals.

New paradigm

The Rest…HERE

Investment decisions are no longer being made by financiers, but increasingly by PhD mathematicians and the immensely complex computer programs they devise.

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