Unlike fundamental investors, whose success relies on a series of independent opinions about attractive companies within their universe, the success of quantitative managers is based on long-term research of new signals that constantly refresh their systematic processes. Too often, this research process is uninspiring and relies on imitating academics or randomly testing data being sold to systematic investors by big-data startups. The PanAgora Stock Selector process has a long-tenured, well-structured, overarching investment philosophy of consistently seeking new ways to quantify fundamental insights. The key to the team’s success is a framework that has a clear and defined mission and long-term plan, along with a unique process.
A common question we are asked is, “How do you come up with the ideas that drive your research?” This is a very important concept in quantitative investing. The goal is to develop long-term, resilient signals that are different from our competitors’. The PanAgora Stock Selector process takes a unique approach to doing this. We believe that the most important tenet of our philosophy is to ground our quantitative factors in fundamental metrics and business characteristics.