Quants Fire Back At Paul Tudor Jones

[marketsurfer]

https://www.bloomberg.com/news/arti...ts-off-latest-feud-with-quants-on-risk-parity

Paul Tudor Jones says automated trading strategies are poised to blow
up the market when volatility returns. That’s not going over well at
one of the biggest quant shops on Wall Street.

Speaking at a closed-door Goldman Sachs Asset Management conference
earlier this month, the billionaire hedge fund investor said that a
portfolio strategy known as risk parity will eventually act as “the
hammer on the downside” when turmoil returns to equity markets.

For AQR Capital Management LLC, a giant in the risk parity field, the
concerns are overblown, with any selling forced by the strategy having
an “utterly trivial” impact on the $23 trillion U.S. equity market.

 

[Handle123]

I have to laugh at those who complain about collapse on down moves as they don't seem to complain as market going up. If you are trading futures/short selling stocks, there is going to incredible moves and great wealth change hands. No one speaks of Tudor and other funds going to reap billions on the down move.

I agree with AQR as they are not like the others in full blown bull market activity. It never changes, those who complain the loudest usually are the problem.

 

[R1234]

I would think most people using 'risk parity' (aka leveraging inverse to asset volatility) would be smart enough to bring it back down as vol rises

 

[comagnum]

In Feb. some big hedge fund managers raised the alarms on the lack of liquidity to exit during a sell off.

https://www.bloomberg.com/news/arti...dity-falls-to-danger-zone-in-u-s-stock-market

 

[Spooz Top 2]

He believes his deliberate ambiguity allows him to obfuscate every scenario... Typical narcissistic trait.

 

[recession2016]

he's been proven to be right already, just take a look at august 2015 when futures gapped down 5% and stocks crashed at the open on monday