Quantopian Makes First Allocations To Crowd-Sourced Algo Strategies

Apr 6 2017 | 9:22pm ET

Online investment algorithm platform Quantopian has begun allocating the $250 million in capital received last fall from Steven Cohen’s Point72 Asset Management.

Investments range from $100,000 to $3 million, the firm said in a statement, and went to the 15 top crowd-sourced strategies that survived a rigorous evaluation process of more than 100,000 submissions. Both the size and the number of allocations will be ramped up on a monthly basis, the company added. 

The news comes close on the heels of Quantopian’s March decisions to team with fund administrator SS&C to support its investment operations and bring aboard former Boston Company executive Leslie Baccini as director of investor relations. 

Quantopian allocated to quants in Australia, Canada, China, Colombia, India, Spain, and the United States, the company said, while the winning developers come from many walks of life, including data science, finance, engineering, software development, and academia.

Authors on Quantopian retain the intellectual property of his or her algorithm and license it to the company for 10% of the algorithm’s net profits.

“Talent is everywhere in the world, not just at hedge funds located around New York City,” said John “Fawce” Fawcett, CEO of Quantopian, in the statement. “Quantopian gives talented people anywhere the chance to learn how to create new investing strategies and apply what they’ve learned on our platform. We are just beginning to give people a chance to put their knowledge to work.”

"We are looking forward to increasing steadily the value of our allocations in the coming months -- from tens and then to hundreds of millions of dollars,” added Jonathan Larkin, Quantopian’s CIO.

Quantopian’s unique platform allows authors to research and test their ideas and use a fast-growing catalog of high-quality datasets. More than 120,000 members from 180 countries have used the platform to run more than 6 million simulations.

“Our research and educational platform for algorithm authors is now matched by a state-of-the-art trading system to provide high quality trade execution services for investors,” Fawcett said. Quantopian has assembled an experienced trading team over the last year as part of its investment management practice.

Boston-based Quantopian offers an integrated, free, community-based platform that offers access to deep financial data, research capabilities, university-level education tools, a backtester, and the opportunity to receive a capital allocation. Quantopian’s community has doubled in each of the last four years and now totals more than 120,000 members in 180 countries. The community’s members have run more than six million simulations on the platform. 

Quantopian has received nearly $50 million in equity investments, including a Series C round led by Andreessen Horowitz, and announced its $250 million management deal with Cohen’s Point72 last September. 

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