Lehman Brothers’ Logo

I’m Ken

Before talking about my individual presentation, let’s take a look about this picture.

We can see Lehman Brothers’ logo, and what the first thinks bump into your head? I think maybe the 2008 financial crisis, right, my individual presentation is about the financial crisis in 2008.

The Robots can’t stop the us repeating the mistakes of 2008. This a topic is a discussion formed by a Bloomberg Opinion Columnist Mark Gilbert and a fund manager Robert Frey. Actually I can’t decide which topic I want to present until I saw this NEWS, because before I saw it, I have been already thinking about this topic for a long time. And once I read this NEWS, I decided to share this NEWS to everyone.

Then, let’s start from the background of Robert, the speaker of this topic.

He was fund management in 1980s and then become managing director in a legendary company Renaissance Technologies LLC over a decade, and the company is found by a legendary person Jim Simons, this guy is really a someone if anybody is interesting in fund management or trading, you can google his name. And this company is called the greatest moneymaking machine by Bloomberg.

And he quit to become a professor at Stony Brook University and teaching quantitative finance in 2004. And start own business Frey Quantitative Strategies, using statistical tools which manager create alpha and which is by the trends.

OK, after introducing the Robert. There are seven questions in this topic and I divided them into three part. The first is what the problems brought by new technology. The second part is how many fund manager can still create alpha. The third part is after the new technology is used, what the environment condition, is the environment more likely to efficient market?

There are three questions in first part, In the Robert opinion, most of people use the model but doesn’t know the meaning of result, and people focus on the goodness of fitness but not focus on is the result meaningful. Because people always wants a new method. When it come up, people take it as potion to every problem, which makes technology is oversold. So, in this part, the major problem is human nature, which makes us too dependent on the new method rather than figure out whether it’s useful to some specific situation.