The biggest and fasting growing trend in investing is the increasing use of Quant (Quantitive) Funds. As it stands somewhere between 16-25% of current trade volume is made up of quant funds. Quant funds are a product of the growing trend of quantitive analysis. The same technology that is defeating world class chess champions, and propelling self driven cars is slow becoming a dominant force in the financial world as well.


Quantitive analysis is a form of analysis based on mathematical measurements, calculations, statistical modeling and research. It's aim is to use the data and the statistics to gain an objective understanding and predictably to the behavior of events, markets, companies, financial instruments, etc. Computer based models are designed and then used to determine the attractiveness of an investment.

The early progenitors of quantitive analysis and quant funds are often referred to as "quants" themselves. Even with their growing popularity quantitive funds still face skepticism. No one really understands how their algorithms work and thus the process is sometimes referred to as "Black Box". Not all investors are fond of the mystery behind quant funds.

Conversely actively managed quant funds are beginning to consistently outperform their counterparts. With a data driven, testable, and easily reviewable as to the errors approach, quant funds are attracting more and more investor dollars.This in turn leads to more development of the technology and methodology behind quantitive analysis, hence making it more effective and attracting eve more investor dollars.

Late 19th - early 20th century French mathematician Louis Bachelier is credited as the early pioneer for quant analysis and funds. In his Ph.D. thesis titled "The Theory of Speculation" Bachlier makes use of statistical analysis to study and understand stock price fluctuations. As with most pioneering genius, Bachelier's ideas were initially met with skepticism and scrutiny. Decades later his work would be properly recognized.

The financial crash in the 1930's led two Columbia professors - Benjamin Graham and David Dodd to publish a book titled "Security Analysis". The placed an impetus on developing a new investing strategy that was more disciplined in its framework. This approach focused on the analyzing a company's financial statements and comparing it's market value against it's intrinsic value. It would lay the foundation for what is now know as "value investing". As the technology developed with the theory, more investors and academia jumped on board.

The earliest versions of activity managed quant funds were developed and launched in the first half of the 1980's. Since then software has rapidly evolved to suit the purposes of gathering, analysis, and making predictions based on the data. Ahead of the 2008 market crash, quant funds began to exhibit strange behavior. As if they had predicted the crash a year before it happened, quantitive funds across the board began entering into sell positions. While some viewed this as erratic behavior and felt cause for concern, others saw the true potential in the quantitive analysis process, and since then quant funds have more than tripled in market share.

Subscribe to PayPath Newsletter
PayPath
Follow Us on

I thought I had a pretty good handle on my finances out of school. I worked several jobs while attending university and had little to no problem managing my income. However, once I graduated, I realized how much more complicated personal accounting could really be.

There were so many variables I needed to keep track of. Biweekly bills, monthly charges, and general necessities amounted to a heap of confusing numbers that were often impossible to decipher. The funniest part was that I was actually trying to do this by hand (I don't know what I was trying to prove to myself, either).

After messing up for the 17th time, I decided to give Microsoft Excel a shot. I used Excel a bit in school and I knew all the big-wig finance people used it, so what could I possibly have to lose? The answer is about six hours of my precious time. Excel isn't much of an improvement over handwriting and it's still dependent on the user to manually input all of the information. It's like doing everything by hand with the slightest help, meaning that it still required a tremendous amount of time and concentration. Well that was all for nothing, I guess.

It's sort of funny. I was certain that I could manage my personal finances with ease, when it's practically a full-time job. I was already stressed out enough with my first job and I knew I didn't have enough time to give my finances the attention it deserved.

That's why I decided to try out a budgeting app. My best friend told me that he uses an app called Truebill to manage his finances. "What does it even mean to manage your finances?" I asked him. He told me that Truebill was the personal financial assistant I wished I could have. It could aggregate all of my account information into one place and give me specific insights and actions.

I loved the idea of having full control over my finances, especially during a time of financial uncertainty, and I realized that Truebill would be the easiest way to accomplish this. The user interface is incredibly simple and intuitive, so it doesn't even feel like a finance app! Truebill offers a multitude of features, with their most popular being the ability to cancel subscriptions with the press of a button.

Okay, I had no idea how many subscriptions I was still subscribed to. In fact, I wasn't even using a quarter of the subscription services I was signed up for. Subscription boxes, streaming services, my old gym, and even an old subscription to my favorite magazine--it was all there and I was livid. How could I let myself waste all of this money and how did I never catch this? Thank goodness for Truebill.

Truebill also offers bill negotiations. There is a 40% fee based on how much you save and Truebill even claims that there is an 85% chance that they'll be able to lower your bill once a negotiation is requested. Why wouldn't I take them up on this? There was zero risk and I would only have to pay once my bill was lowered (which means that I would be saving money regardless).

More standard features of Truebill include the ability to generate a credit report on-demand and even request a pay advance. I only used the pay advance feature once when I wanted to buy a gift for my mom, but didn't have enough cash in hand and Truebill automatically reimbursed itself when I got my next paycheck.

The credit report is another fantastic feature and practically taught me what good credit meant. Truebill's credit report basically shows you which financial decisions have the most significant impact on your credit score and ways that you can improve your credit month-over-month. I've never had such control over my credit and it feels good.

I'll be the first to admit that I was extremely naive coming out of school. I figured that as long as I was attentive, I could manage my finances with ease. We manage money to some extent throughout our entire lives, but once you're thrown out on your own, it's a completely different story. With Truebill, I've finally been able to take control over my finances and stay on top of all of my responsibilities.

Update: Our friends at Truebill are extending a special offer to our readers! Follow this link to sign-up for Truebill.