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Warren Buffett and Charlie Munger on why they won't hire a quant, even though Jim Simons proved it works: A questioner points out that Jim Simons' Medallion Fund returned 39% net of fees for three decades, then asks whether Berkshire would consider hiring a quant lieutenant to work alongside Ted or Todd. Buffett's answer is immediate: "Well, I'll say no to the second part." Then he hands the analysis to Munger, who breaks down exactly where quantitative investing worked and where it didn't. Munger notes that the leading quant fund did fabulously on short-term trading: "They found little algorithms that worked... they had predictive value, and as long as they kept working, they just kept doing it as long as the money kept coming in." But the same approach hit a wall when stretched to a longer horizon: "When they got to using the same system... for long-term stock predictions, the record was not nearly as good." Munger also highlights a constraint most people miss. The edge had a ceiling built into it: "In the short-term stuff, they found that if they tried to do it too much, they destroyed their own advantage, so there was a limit on the amount they could make." His verdict on the people behind it is admiring rather than dismissive: "But they were very, very smart... very smart and very rich." Buffett echoes the respect, calling Jim Simons "very high grade," before explaining why none of this changes Berkshire's approach: "We're not trying to make money trading stocks. I mean, the answer is we don't think we know how to do it. If we knew how to make a lot more money trading stocks, we'd probably be trading stocks too, but we don't know how to do it, and we really don't trust anybody else to do it for us. It's that simple."

Black Edge

35,601 просмотров • 23 дней назад