Quantitative investment is the use of mathematics, statistics, information technology and other knowledge in the investment process. Investors will collect stock data, and then rely on the powerful information processing capabilities of computer systems to replace manual subjective judgments with advanced mathematical models, thereby achieving maximum returns while controlling risks.

Quantitative investment has many advantages. For example, investment strategies are based on large-scale data, execution is not affected by investor emotions, can effectively overcome cognitive biases, can quickly track market changes, and constantly look for new opportunities. Statistical models to deliver excess returns and find new trading opportunities. As a prerequisite for effective risk control, quantitative investment can be used as a tool for investment diversification. For example, quantitative investment can mine certain patterns from historical data and make use of them. These rules provide a greater probability of a return on investment.

In the process of quantitative trading, the application of quantitative investment thinking covers almost the entire investment process, from the selection of investment goals, analysis of portfolio strategies, implementation of strategies to investment goals, and finally to the risks of investment strategies The characteristics of control and feedback make quantitative thinking unique in different investment fields. The formation of different investment styles has different focus of content. Several concepts are related to optimal strategies, including trend strategies, quantitative hedging strategies, arbitrage strategies, high-frequency strategies and algorithmic trading. Of particular concern is algorithmic trading.

The reason why quantitative investment is popular is that it even has subjective investment trends, which must have the advantages of quantitative investment. All in all, there are the following points: It is based on mathematical statistics, closer to a science, makes the future easier to predict and perceive, and can monitor all markets and transactions in real time throughout the year, while humans cannot. It avoids human emotions, is completely automated by machines, and strictly enforces discipline. The process and risks are more controllable. These advantages have gradually brought quantitative investment into our horizons and been accepted by more and more investors.