Thanks to a run of steady performance by the markets and less than fierce competition in the aftermath of the financial crisis, quantitative funds are well-positioned for growth in the near-term.
Quant funds were battered during the 2008 market crash, a slump that carried into 2009, according to a report by TheStreet.com. Those struggles led investors to dump those funds, many of whom ultimately left the market. But TheStreet.com reports there's a tailwind in place for the sector with Vanguard's Strategic Small-Cap Equity fund leading the pack.
A leader is Vanguard Strategic Small-Cap Equity, which has returned 11.5% this year, outdoing 96% of its small blend competitors. Other funds with strong results include Bridgeway Small-Cap Value, Flex-funds Quantex, Fidelity Disciplined Equity and JPMorgan US Small Company. Picking a quant fund is not easy. Concerned about maintaining their competitive edges, managers rarely provide more than general details about the screens that they use. To pick likely winners, look for funds with low expenses and strong long-term records. A fund that fits the bill is Bridgeway Aggressive Investors 1 (BRAGX_), which returned 11.1% annually during the past 15 years, outdoing 96% of its mid-cap growth competitors. Another winner has been Vanguard Strategic Equity (VSEQX_), which has returned 9.0% annually for the past 15 years, outdoing 63% of mid-cap blend peers.As the Senior Editor of Advanced Trading, Justin Grant plays a key role in steering the magazine's coverage of the latest issues affecting the buy-side trading community. Since joining Advanced Trading in 2010, Grant's news analysis has touched on everything from the latest ... View Full Bio