QUANTITATIVE STRATEGIES

QGVM

QUANTITATIVE GLOBAL VALUE MODEL
Employs a proprietary and systematic process that ranks large cap global equities on their relative valuation, operating metrics, financial strength, and price momentum.

QCVM

QUANTITATIVE CANADIAN VALUE MODEL
Employs a proprietary and systematic process that ranks large cap Canadian equities on their relative valuation, operating metrics, financial strength, and price momentum.

QAAM

QUANTITATIVE ALL ASSET MODEL
Employs a proprietary and systematic process that ranks large cap global equities on their relative valuation, operating metrics, financial strength, and price momentum.

WHAT ARE QUANTITATIVE STRATEGIES?

Quantitative strategies typically combine proprietary investment systems with systematic, rules-based decision making. Utilizing computers and advanced software to uncover and exploit historically statistically significant anomalies, quantitative strategies aim to produce superior risk-adjusted returns.

At Generation Portfolio Management Corp., most of our quantitative research is focused on what are known as fundamental factors, or specific attributes that stocks possess that may explain the cross-section of investment returns. For example, stocks with value attributes (e.g., low fundamental ratios, high dividend yield) may perform differently than stocks with growth attributes (e.g., high historical revenue growth) over a specified time frame.
BENEFITS OF QUANTITATIVE STRATEGIES

Systematic
Quantitative strategies are not dependent on ad-hoc idea discovery. Strategies are executed systematically with computer systems scouring the investment universe for the most optimal investment opportunities as defined by the strategy’s parameters.

Quantitative Strategies can Reduce Operational Risks
With quantitative strategies, investors do not need to worry about style drift or the departure of key managers.

Quantitative Strategies Attempt to Eliminate Behavioral Biases
Even seasoned investment professionals are prone to behavioral and emotional biases. The disciplined and systematic nature of quantitative strategies means that the day-to-day noise of market news is ignored. Sub optimal decision making during periods of extreme fear or greed is not possible as long as the strategy is being implemented as intended.

Transparency
The operational parameters of a quantitative strategy are well communicated to the investor and decisions are made in strict accordance with the parameters. This transparency, informational content, and faith in execution can help investors maintain confidence during periods of underperformance.

CONTACT


RJ Steinhoff, CFA
Director of Research
416-915-5734