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The Opalesque Team: Thursday's Battle of the Quants event saw a group comprised of both managers, investors, and suppliers meet in Midtown Manhattan to debate a myriad of topics affecting this slice of the industry. Panels of investors discussed the aspects of quantitative strategies which appealed to them most and managers debated the different approaches to decision making when running a quantitative fund, the role of hedge funds and quant managers in the financial crisis from August 2007 to the end of 2008, extracting alpha, and the future market opportunities for quantitative strategies.

However, one theme which seemed to thread its way through many of the "battles" was the shifting sense of the importance of communication between hedge fund managers and hedge fund investors. The investors in quantitative funds referred to themselves as "buyers of quant" but said allocations are determined and managed in terms of risk profiles. As such these managers need to have a certain level of comprehension of the portfolio compositions and processes quant funds have in place for their approach to analysis and trading. The good news is that investors view quant systems as being more rules-based than the systems of discretionary managers, and investors have found this also allows quant managers to better explain their edge - that is, when quant managers are willing to divulge any information at all about their strategies.

Some investors are still willing to allocat......................

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