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Tell that to Jim Simons, math PHD and multi billionaire founder of Renaissance Technologies- a hedge fund based entirely on computer trading. There is certainl

• kingkongrevenge 18y ago
  Probably lucky outliers. Any data mining driven approach that shows good returns is arbitraged out of existence almost immediately, unless it's niche and thus unscalable to a larger fund. All the blackbox systems end up doing pretty much the same thing and getting low returns. The markets are simply too dynamic for a pure data and algorithms system to work. One needs to use theory to win, and the guy picking the theories in the program is exactly the same thing as a manager in the first place. The only way to get rich from a naive blackbox is to twist the risk knob up to 11, which always goes badly eventually.