In a new book on quantitative trading strategies, entitled, “Inside the Black Box: The Simple Truth About Quantitative Trading,” Rishi Narang, founding principal of Telesis Capital, seeks to explain with real-world examples and anecdotes what it is exactly that quants do.
“The book is largely a response to what I would say is mass ignorance about quant trading,” says Narang. “This book is an explanation of what quants do – it goes through the entire proto-typical quant trading strategy; how it works and how people build them.”
Narang cautions though that this is not a “how to” book for quants looking to write new strategies, it’s a higher-level explanation of the quant world. “This is primarily directed at people who understand the markets and are in the business as a professional and understand some but not everything about mathematics and quantitative trading,” he explains. “The book tries to make it intuitive and gives an economically-based explanation of how quants really make money and mange risk.”
The book focuses on a few major questions that Narang says are important to understanding the quant world. These include: what is a quant, what are the secrets of successful quant trading, what caused the disasters in quant trading, what role did quants play in the credit crisis, and what is the future of quant trading?
About the Author Rishi K Narang is the Founding Principal of Telesis Capital, which invests in quantitative trading strategies. From 2002 to 2005, he was managing director and co-portfolio manager at Santa Barbara Alpha Strategies. Narang was president and vice chairman of Tradeworx, Inc., a quantitative hedge fund manager, from 1999-2002. He has been involved in the hedge fund industry, with a focus on quantitative trading strategies, since 1996. Narang graduated from the University of California at Berkeley with a BA in economics.