Part One The Quant Universe.
Chapter 1 Why Does Quant Trading Matter?
The Benefit of Deep Thought.
The Measurement and Mismeasurement of Risk.
Chapter 2 An Introduction to Quantitative Trading.
What is a Quant?
What is the Typical Structure of a Quantitative Trading System?
Part Two Inside the Black Box.
Chapter 3 How Do Quants Make Money?
Answer: Alpha Models.
Types of Alpha Models: Theory-driven and Data-driven.
Theory-Driven Alpha Models.
Data-Driven Alpha Models.
Implementing the Strategies.
Blending Alpha Models.
Chapter 4 Risk Models.
Limiting the Amount of Risk.
Limiting the Types of Risk.
Chapter 5 Transaction Cost Models.
Defining Transaction Costs.
Types of Transaction Cost Models.
Chapter 6 Portfolio Construction Models.
Rule-Based Portfolio Construction Models.
Output of Portfolio Construction Models.
How Quants Choose a Portfolio Construction Model.
Chapter 7 Execution.
Order Execution Algorithms.
High Frequency Trading: Blurring the Line between Alpha and Execution.
Chapter 8 Data.
The Importance of Data.
Types of Data.
Sources of Data..
Chapter 9 Research.
Blueprint for Research: The Scientific Method.
Part Three A Practical Guide for Investors in Quantitative Strategies.
Chapter 10 Risks Inherent to Quant Strategies.
Regime Change Risk.
Exogenous Shock Risk.
Contagion, or Common Investor, Risk.
How Quants Monitor Risk.
Chapter 11 Criticisms of Quant Trading: Setting the Record Straight.
Trading is an Art, Not a Science.
Quants Cause More Market Volatility by Underestimating Risk.
Quants Cannot Handle Unusual Events or Rapid Changes in Market Conditions.
Quants are All the Same.
Only a Few Large Quants Can Thrive in the Long Run.
Quants are Guilty of Data Mining.
Chapter 12 Evaluating Quants and Quant Strategies.
Evaluating a Quantitative Trading Strategy.
Evaluating the Acumen of Quantitative Traders.
How Quants Fit into a Portfolio.
Chapter 13 Looking to the Future of Quant Trading.
About the Author.
In "Inside the Black Box," Rishi Narang makes the impossible seem possible: he takes the vastly misunderstood role of the quantitative trading strategy and makes it understandable to those with only the most tenuous working knowledge of global capital markets. How he does so is a sleight of hand no more complicated than patient, consistently eloquent writing, and easy-to-understand, basic examples."
?Markets Media Online
"The book, Inside the Black Box: The Simple Truth About Quantitative Trading, by Rishi Narang, is hands down the best introductory book I've read on the topic. Narang does a brilliant job of explaining (in simple English), how and why quantitative trading works. If you are looking for a primer on Quantitative Trading I strongly endorse and recommend this book."
"In a new book on quantitative trading strategies, entitled "Inside the Black Box: The Simple Truth About Quantitative Trading," Rishi Narang, founding principal of Telesis Capital, seeks to explain with real-world examples and anecdotes what it is exactly that quants do?The book focuses on a few major questions that Narang says are important to understanding the quant world. These include: what is a quant, what are the secrets of successful quant trading, what caused the disasters in quant trading, what role did quants play in the credit crisis, and what is the future of quant trading?"
"You may be skeptical that Rishi Narang will be able to deliver on the ambitious promise of his book, Inside the Black Box: the Simple Truth about Quantitative Trading (published by John Wiley & Sons, 2009). But he does deliver. He tells you, in language that can be understood by most educated people, what a quantitative trading system is and what a quant does."