Money Machines – An Interview with an Anonymous Algorithmic Trader

Once you’ve made that decision, you have a rule that lets you allocate money across stocks and bonds at some defined frequency automatically, without a human being going in and having to make any qualitative decision. This basic framework was rapidly adopted across investment portfolios at every scale, from mutual funds for individual investors to asset allocation decisions by the largest funds in the world. When the financial industry plugs a bunch of data into a model in order to make an investment decision, how important is the explainability of the result?

Source: logicmag.io