Quantitative wins over Qualitative

In the last 20 years, the amount of assets managed by quantitative and qualitative hedge funds have grown dramatically.  A study published in 2010 (A Comparison of Quantitative and Qualitative Hedge Funds) examined the difference between quantitative and qualitative hedge funds in a variety of ways, including management differences and performance differences. They found that both quantitative and qualitative hedge funds have positive risk-adjusted returns. They also find that overall, quantitative hedge funds as a group have higher alphas than qualitative hedge funds. The outperformance might be as high as 72 bps per year when considering all risk factors. They also suggest that this additional performance may be due to better timing ability.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: