7 – MV 13 Global Talent Is Equally Distributed V1

We believe that the community of students who are taking this nanodegree are doing more than just getting themselves ready to enter the quant trading industry. You and your community of classmates are helping us to prove that talent exists in every corner of the world. I have to admit that from the outside of … Read more

6 – M1L6 12 Finding Alpha V1

Formulating trading strategies often starts with an observation. A pattern that seems to be recurring in the market over time. At that point, your creativity and intuition tell you that there might be an opportunity for monetization. Your job as a contrator then, is to turn this observation into an expression, both mathematically and programmatically … Read more

5 – M1L6 09 Statistical Analysis V10

Now we are ready to perform our analysis. The resulting returns time series is the theoretical monthly performance of our long-short portfolio. Our goal is to see if the mean monthly return is greater than zero. Let’s calculate that. So, our mean is indeed greater than zero at 0.53 percent, but does this mean that … Read more

4 – M1L6 06 Trading Strategy V2

Here’s how you might approach the problem of formulating the complete trading strategy. Our goal is to construct a stock portfolio of long and short positions, and the selection process for stocks to go into the portfolio is based on the stock’s returns performance relative to other stocks. For this example, we shall assume we … Read more

3 – M1L6 04 Long And Short Positions V3

Once you have found a signal that seems to indicate the future performance of a stock, it is time to put it to action. For instance, if you think that a stock has upward momentum, you might want to buy some shares and hold onto it for a fixed period of time, or until you … Read more

2 – M1L6 02 Momentumbased Signals V4

Newton’s first law of motion states that an object at rest stays at rest, and an object in motion stays in motion with the same speed and in the same direction, unless acted upon by an unbalanced force. While Newton’s laws may seem to have little to do with the vagaries of the stock market, … Read more

1 – M1L6 01 Designing A Trading Strategy V4

A trading strategy is a set of steps and rules that help you decide what stocks to buy or sell, when to perform these trades and how much money to invest in them. Designing a successful training strategy that reliably generates profits for you while minimizing the risk of losing money is indeed a complex … Read more