Quantitative Factor Models: AI-Enhanced Stock Selection Using Multi-Factor Frameworks
2026-03-27 · AI & Machine Learning in Trading
Factor investing systematically harvests return premiums associated with value, momentum, quality, and other characteristics.
Factor Definition and Construction
Each factor is constructed from multiple underlying metrics.
Factor Timing
Academic research suggests factor returns are partially predictable.
Factor Interaction Effects
Stocks scoring well on multiple factors simultaneously (e.g., cheap AND improving momentum) tend to outperform.