Alpha Architect Research Blog

The Newest Alpha Architect Research and Insights

Book Review — Common Stocks and Common Sense

Investing can perhaps be best learned through a combination of applied practice and continuous study. While there is no substitute for real-world experience and the valuable lessons learned from making and losing money, reflecting on the wisdom of those who ...

How to Turn an Engineer into a Quantitative Investor

We receive multiple requests from readers looking to break into the finance industry. Quite often the reader is currently working in a traditional engineering job and looking to make a career switch. The question we often hear is “How does ...

Reflexivity and the Feedback Effect in Financial Markets

Eugene Fama's Efficient Market Hypothesis argues that because stock prices follow a "random walk," future price behavior cannot be predicted. In his seminal paper, "Random Walks in Stock Market Prices," he explains the relationship between prices and fundamentals: If the ...

Evidence-Based Nutrition

Evidence matters. Consider the history of evidence about the universe. In the days of Ptolemy in 100 AD, a "geocentric" model described the universe, in which the sun, moon and stars all revolved around the earth. Watching bodies revolve in ...

How to Measure Momentum?

Since we've released our new book, Quantitative Momentum, we've received a handful of basic questions related to momentum--specifically as it relates to stock selection. At this point, the so-called "momentum effect" has occupied academic researchers for several decades. Researchers have ...

What is the best “Risk-Off” Asset for Trend-Followers?

So you're a trend-follower. Great. But here is a question: What do you invest in when your rules suggest "risk off?" Many investors suggest low duration cash or t-bills. Seems reasonable. But is it optimal? Perhaps we should invest in ...

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