Quant funds facing more pressure?

Will other quantitative funds follow in the steps of GMN Capital of San Francisco? According to the AP, the fund has informed investors that it will shutter itself and return funds by the end of the year. The move follows big losses in August, when assets dropped below $500 million from a high of $1.2 billion. Certainly, quant funds are out of vogue right now. Some are questioning the viability of the class. While none of the big boys of the industry, such as AQR Capital Management and Renaissance Technologies, are considered vulnerable, a host of less known funds could be forced to shut down. You have to think that the black box approach is in need of something new and exciting, as people have really lost confidence. Tweaking the models may not be enough.

For more:
- here's the AP article

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