Does AQR run quant trading strategies?

Title is to the point: does AQR run quant trading strategies?

I get the sense that the fund doesn't really run quant trading strategies, and rather does a lot of quantitative work on portfolio optimization and asset selection.

Is this right or wrong?

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Best Response
"QGKZ"

From what I've heard about AQR, they focus predominantly on, as you said, portfolio optimisation and asset allocation. This is still an area of quant finance, but it is not the same as an alpha-production strategy. My impression is that AQR is an Asset Management firm, as opposed to a hedge fund/CTA/prop firm. If you're more interested in alpha-generation, then you should focus on the latter.

It's true that some of AQR's products are designed to use quantitative methods tactically (ie to optimize between asset classes/styles/etc), but AQR definitely uses quant methods to inform individual security selection. This can range from algorithmic trading to quantitatively-informed stock picking to macro analysis to derivative arbitrage and more.

Also a few related points: >>>In reality "hedge fund" is a vaguely defined term that refers to a form of investment vehicle, and not to the investment strategies it may or may not use. >>>The lines between "asset managers" and "hedge fund managers" are far blurrier than people on this board realize/posture.

For example, AQR manages mutual funds, private funds, managed accounts, etc. with a range of strategies, many of which are usually associated with "hedge funds." BlackRock and PIMCO are best-known as long-only managers but also manage many billions of "hedge fund" AUM

For another example: If I told you a fund took both long and short positions in a range of asset classes, including alternative asset classes, and used derivatives and leverage, you'd probably guess I was describing a hedge fund but it could also be PIMCO Total Return, the largest bond mutual fund in the world.

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