Objectivism asserts that logic is man's means of concept formation/knowledge, and that truths are absolutes. Emotions and intuitions are not means of knowledge: that you feel strongly that 2+2=5 doesn't matter.
Investment Objectivism is the essence of Quantitative or rules-based investing.
Quantitative (or rules-based) investing uses cutting-edge mathematics to identify patterns among decades' worth of stock prices and other financial market data. The ultimate goal is to find investment strategies that have been successful in the past and therefore are likely to be successful in the future. This is a fundamentally different approach than most mutual fund advisors. For example, a typical advisor might try to size up a company and its stock by examining current financial statements and then form an opinion about the firm's future prospects by evaluating the quality of its management, customers and competitors. In contrast, quantitative investing is based entirely on data and facts — the hard numbers.
Advantages of Objective Investing
Quantitative investing offers the following advantages…
Unemotional. Quantitative investing uses logic and historical facts to drive decisions. American First strategies strip away the human bias that trips up many investors and investment professionals who often buy into market trends at precisely the wrong time and overlook real values.
Back-Testable. A fact-based approach is consistent and repeatable. It is based on historical performance data to help provide results and help manage investment risk. At the heart of every portfolio managed by AFCM is the process of back-testing. A back-test is a simulation of how a real-life investment strategy might have responded to historical markets. The most remarkable aspect of back-testing comes from the ability to see how successful a strategy has performed in the past, so well have a better idea as to what our probability of success may be now and in the future.
The potential for market-beating returns. By examining years of stock returns and other financial data using powerful technology, fact-based investing seeks to identify investment strategies that were previously successful and have qualities that indicate their likelihood to succeed in today’s markets.
iQuant is among the leaders in the Quantitative Investment community. Our investment models have earned several Lipper Leader and Fund Elite awards for their peer-related performance.
We look forward to providing cutting-edge models for you and your clients.