Quants Fire Back at Paul Tudor Jones After His Attack on Risk Parity
- Macro manager sees strategy as driver for next stock selloff
- Risk parity didn’t dump all stocks in last correction: AQR
A trader is reflected in a monitor as he works on the floor of the New York Stock Exchange.
Photographer: Jin Lee/BloombergThis article is for subscribers only.
Paul Tudor Jones says automated trading strategies are poised to blow up the market when volatility returns. That’s not going over well at one of the biggest quant shops on Wall Street.
Speaking at a closed-door Goldman Sachs Asset Management conference earlier this month, the billionaire hedge fund investor said that a portfolio strategy known as risk parity will eventually act as “the hammer on the downside” when turmoil returns to equity markets.