Invesco’s Tarun Gupta explains how factor investing helps generate consistent alpha

His credentials and pedigree as a practitioner and an academic are well-known among the quant investing community, but perhaps less well-known is quantitative analyst Tarun Gupta’s ability to play a course handicap of zero on any rated golf course as a scratch golfer, or the mathematical competencies that have allowed him to become a keen poker player among his hedge fund colleagues. These are all the hallmarks of a star quant analyst taking on calculated risks to deliver superior returns.
Speaking at an Invesco luncheon, Gupta explained how he took the academic path and focused his skills on creating innovative research on quantitative investment strategies for several well-known Wall Street banks. He now heads up Invesco’s IT for Invesco Quantitative Strategies and is also the managing director of Research.
Quants – better known as the “rocket scientists of Wall Street” – are the brains behind every bank and hedge fund. Quants identify ‘factors’ and construct strategies that best extract them. For that reason, this strategy is also called factor investing and utilises computers to formulate, test and implement these strategies. Mathematical equations aside, the end goal is one of risk management i.e., to deliver superior risk-adjusted performance.
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