What type of funds use numerical methods like quantitative analysis or algorithms to select investments?

Quantitative funds, commonly referred to as Quant Funds, utilize sophisticated numerical methods and algorithms to make investment decisions. These funds rely heavily on quantitative analysis, which involves the use of mathematical models and statistical techniques to identify investment opportunities. By harnessing vast amounts of data and employing advanced computing techniques, Quant Funds can analyze patterns, trends, and correlations that may not be apparent through traditional investment approaches.

This method allows Quant Funds to make objective decisions based on data rather than subjective judgment or market sentiment. As a result, they can quickly adapt to market changes and react to various economic indicators, often resulting in a more systematic and disciplined investment strategy. The focus of these funds on metrics and algorithms distinguishes them from other types of investment funds, which may rely more on fundamental analysis or market timing.