Lessons from the Third Wave of Investing: Machine Learning and Alternative Data

Michael Oliver Weinberg, CFA
Shreenivas Kunte, CFA, CIPM

The evolution of investing can be divided into three “waves,” according to Michael Weinberg, CFA. The first and second waves of “fundamental discretionary” and “quantitative” investing, respectively, have been followed by an emerging third wave that involves sophisticated computing techniques and leveraging the power of machines. Strategies in the third wave are a confluence of 5 factors: 1) The exponential growth of data, 2) Data science, 3) Machine learning, 4) Record-low processing and storage costs, 5) Playing close to the information edge.

In this webinar, we will cover the following:

How can the confluence of five factors assist with better investing outcomes?
What traits are typical of the best and worst third-wave managers from an investment due- diligence perspective?
How does one differentiate between third-wave managers, and second-wave managers--traditional computational finance managers?
What are the skill sets and the learning required to become a third- wave manager?

This is the archived version of a live webinar that took place on 4 October 2018.