Mean reversion trading of correlated pairs
Mean reversion trading of correlated pairs
Quantitative investing was pioneered by Ed Thorp and later transformed by Jim Simons and Renaissance Technologies, whose Medallion Fund achieved extraordinary returns using mathematical models. The field draws on academic finance (Markowitz's Modern Portfolio Theory, 1952), statistical learning, and signal processing. D.E. Shaw, Two Sigma, and Citadel further expanded quantitative methods into systematic trading. The 'factor zoo' research by Harvey, Liu, and Zhu (2016) brought rigorous statistical testing to the proliferation of quantitative strategies.
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Higher-risk profile — expect large swings and deep drawdowns in pursuit of outsized returns.
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Backtested KPIs are estimates derived from historical data and do not guarantee future returns. Markets carry risk of loss.
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