Re: Quant Funds and the August Meltdown
I think the key problem with the quants is believing what the companies told them. Any program is no better than the inputs. Part of the inputs used to determine if a stock was "undervalued" were the financials. Many of the crappier financial stocks hid, and continue to hide, facts regarding their crappy CDO portfolios, et al.
Even now, they aren't disclosing what deep do-do they are in. However, the public knows better and is slamming the hell out of them. The programs are blind and can only see the numbers released in public information.
|