Select another investor profile To access more content, select your investor profile

Quest AI-Driven

Quest AI-Driven, a strategy that invests across the global equity market, harnessing AI to select the best stocks

Active Equity
Our strategy aims to deliver compounding outperformance by harnessing the scale and efficiency of artificial intelligence for stock selection in an enhanced index product with low tracking error and lower fees.

  • #1 Leveragin the scale and efficiency of AI

  • #2 Providing a core and stable equity holding

  • #3 Capitalising on an experienced team

What is machine learning?

Machine learning is a field within artificial intelligence in which a computer imitates the way humans learn from experience. It involves training a computer to make predictions or decisions using data, rather than explicitly programming it to follow instructions. This training is repeated to gradually improve the computer’s performance.

As individuals, we are already benefitting from machine learning on a daily basis, when listening to music with smart speakers, picking a film thanks to streaming recommendations or choosing the best route via our favourite application. 

Our investment philosophy

1.

We believe that over short time-horizons, investor behaviour rather than company fundamentals is the main driver of company share price returns.

2.

To identify and forecast the sentiment from this behaviour, a broad range of higher frequency data is required.

3.

By enabling the combination of a wide range of features, artificial intelligence can be a powerful tool to quickly and efficiently assess investor behaviour and make more accurate forecasts.

   

How do we invest?

The Quest investment team has developed a proprietary and innovative stock selection model that uses AI to forecast relative stock returns.

  • This model uses hundreds of features engineered from a broad range of data such as fundamentals, analyst sentiment, prices and market activity, short interest and calendar effects.
  • Forecasts are regularly updated and combined in a proprietary optimiser with risk and cost estimates that portfolio managers oversee to better reflect market conditions.
  • We also apply Pictet wide ESG exclusions and a positive ESG tilt based on a proprietary ESG scoring model.
Enhanced indexing: the best of both worlds
 Index equity approachesEnhanced IndexTraditional active equity portfolio
Desired tracking errorVery lowLowMedium to high
Active returnSimilar to the benchmarkAiming at compounding outperformancePotentially higher but less consistent returns
Absolute risk profileSimilar ti the benchmarkSimilar to the benchmarkMedium to high
CostLowLowMedium to high
ConcentrationLowLowMedium to high

Our team

Our Quest team consists of 20 professionals with an average industry experience of 15+ yearsAs of 01.04.2024 . They have a skill-set spanning model building, feature engineering, AI/ML, risk management, portfolio construction and implementation.

Their expertise is grounded in academic research, including a focus on machine learned stock selection as a ‘crystal box’ rather than a ‘black box’, which is demonstrated by the publication of several peer-reviewed research papers“Performance attribution of machine learning methods for stock returns prediction”, Stéphane Daul, Alexandra Nagy and Thibault Jaisson, published in the Journal of Finance & Data Science in April 2022, and “Deep differentiable reinforcement learning and optimal trading”, Thibault Jaisson, published in the Quantitative Finance journal in June 2022. published in well-known finance and economic journals.

The lead Portfolio Manager for Quest AI-Driven is Stéphane Daul.

  • 15+ years of industry experience

    Experienced quant team

Source: Pictet Asset Management, 01.04.2024