How To Build A Python Quantitative Trading Strategy That Beats S&P 500?

Beating S&P 500 index consistently year after year is the dream of most of the fund managers. One person who has consistently beaten S&P 500 year after year is Warren Buffet. Warren Buffet is a value investor who read the Intelligent Investor written by Ben Graham in his teens and started believing in his teachings. Over the years he practically applied the teaching of Ben Graham in his stock selection and was able to consistent beat S&P 500 index year after year.

More and more hedge funds are using quantitative trading strategies now a days. In the last post I wrote about how the you can use Quantmod R Package to analyze the daily stock market data. The rise in quantitative trading means market will start responding to these quantitative trading strategies and retail traders will fail to consistently beat the market. This is what the future is dictating. As a retail trader you should also start learning and employing these quantitative trading strategies. R is losing the battle to Python in the language of choice for quant traders.

With the increase in quantitative trading,  can we built a quantitative trading strategy that can beat S&P 500 using python? Watch the video below in which Karen explains how she build a quantitative trading strategy using python with the aim of beating S&P 500 index.

Now after watching this video in which Karen explains how she build a quantitative trading strategy using python that beat S&P 500. Python is getting very popular now a days with quant traders. Over the last few years, tremendous work has been done to make Python the best language for quantitative finance. Python now supports many build in libraries and modules that provide you the opportunity to implement advanced machine learning algorithms.

Learning Python is not difficult. It is one of the easy languages to learn. Unlike C++ and Java which are compiled languages, Python is an interpreted language which makes it a bit slow but still faster than R. As said above it seems that R will ultimately lose the battle to Python. Right now R has many packages that can implement many data analysis algorithms. But in the battle for machine learning, Python is much ahead of R. Watch the video below that shows how to build quant equity strategy!

So make a little effort and learn python. Learning python is not difficult. Once you learn python you will understand how to apply python to quantitative trading.

 

 

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