Our Philosophy — A Blueprint for Quant.
QMA partners with our clients to deliver long-term investment solutions anchored in fundamentals.
We believe that clients are best served by a complete quantitative player. At QMA, we seek to deliver systematic solutions to our clients’ individual investment problems. We draw from the latest market data to help guide our clients with specific risk and return needs through any economic climate. Our goal is to provide targeted alpha to our clients on a consistent basis. We harness fundamental insights built on academic and macroeconomic foundations that we expect will add value to client portfolios over the long term, continually researching new investment opportunities to provide the most effective solutions. As a systematic manager, we can easily modify our processes and customize our offerings to adapt to specific preferences. Our multi-factor portfolios provide cost-efficient diversification, along with the collective wisdom that comes from decades of enhancements to our decision-making models.
Learn how we are helping our clients face their challenges today.*
The Central Tenets of a Successful Quant
A Guide to Navigating Turbulent Times
After a decade of relatively benign market conditions, we’ve moved into more difficult macro environment: the post-passive era. In the face of demanding return targets and lower expected returns, active, multi-asset approaches provide much-needed diversification. Disciplined, systematic approaches are particularly fruitful, as they reduce human error and allow for cost-effective execution.
The potential benefits of quantitative multi-asset investing aren’t limited to periods of market turmoil, of course. Systematic investing is predicated on a team-based approach that negates the risk of placing market calls into the hands of a single decision-maker. The breadth of quantitative solutions comes with a corresponding increase in effectiveness. Robust diversification with transparent exposures down to a fine level of detail are also key to customization.
As multi-factor quant investors, QMA combines pure value with a mix of momentum and quality factors, to diversify sources of
alpha and screen out the low-quality value stocks that may deserve a low rating. While value mispricing relative to growth is close
to all-time highs, there is no fundamental basis to support those prices. As a result, we see a great deal of opportunity in value.
QMA’s thought leadership seeks to guide our clients through current market challenges.
Factor Foundations
Diversification
Solutions and Customization
Partnerships and Alignments
Diversification^
Adaptability and pin-point diversification are essential in the postpassive era. Our selective use of factors in equities and across multiple asset classes may increase our efficiency at converting risk into reward. We believe diversified exposures across dimensions enhances downside protection, while our macro forecasts provide insights into market movements for both current and future diversification needs.
Solutions and Customization
QMA’s modular portfolio construction simplifies our design of client-specific solutions. We can customize down to the stock level for portfolio considerations including high-Information Ratio (IR), targeted volatility, tracking error, tax management and ESG, with product offerings that range from core solutions and systematic macro to multi-asset portfolios and overlays. We believe all of our options can be harnessed to provide stable return streams uncorrelated with existing strategies.
Partnerships and Alignments
As the economic climate becomes increasingly complex, QMA is prepared for the challenge. Our cross-channel, inter-team operations throughout the PGIM organization open up a wealth of options for strategic and tactical implementation. We routinely publish timely thought leadership and direct communications, along with cutting-edge quantitative research. As always, we measure success through lasting partnership with our clients, by helping them meet their investment objectives in even the most volatile conditions.
Factor Foundations
QMA’s data-driven processes are vitally enhanced by teamwork. As a full-quant shop, we work together on common systematic ground to continually enhance our models and product offerings. We then partner with clients across the globe to overcome their toughest challenges, utilizing adaptive and rigorous investment processes that have been central to our objective to convert risk into return for over 40 years.
* There is no guarantee these objectives will be achieved
^ Diversification does not protect against a loss in a particular market; however, it allows you to spread that risk across various asset classes