22 – M4 L3b 22 Summary V2

You did it. This lesson was pretty advanced, but also very meaningful in that we practice reading academic research, thinking about Alpha ideas based on the papers, and then coding up these factors. I want to emphasize that the value of this lesson isn’t that I’m giving you four Alpha factors that will help you become an instant millionaire. The value that I hope you’ll derive from this lesson is an understanding of the process and thinking that quants go through to generate Alphas every day on the job. Remember, we’re teaching you how to fish for Alpha factors instead of just giving you the Alpha factors. As the saying goes, “Give your students an Alpha factor and they’ll have a good Alpha factor for a day or at least until their Alpha factor turns into a common risk factor.” Teach your students how to fish for their own Alpha factors and they’ll hopefully have good Alpha factors for a lifetime.