Hey guys, I wanted to just ask if you could explain how QC uses alpha insights to make trades? I understand each insight emits a long or short or flat signal and that each insight can contain confidence. Can you walk me through an example of how QC uses an insight to make a trade and when to close it? For example, does QC close a positive insight stock after the signal is no longer there?
In addition, what is the point of adding a time delta to an Insight? For example, if I had an insight based on news sentiment and I gave it a 10 day time delta, would this imply that this long signal is good for 10 days (then the stock is sold?). I was wondering if you could elaborate more on these aspects of the AlphaModel.
I am looking to start using the AlphaModel rather than coding my algos in classic formatting, so I would love to get more familiar with this framework.
Adam W
Insights can be viewed as a representation of expected returns for the asset, and this level of abstraction is most useful for algorithms or funds that systematically combine multiple Insights together. The duration parameter is basically: we'd expect the stock to go up after 10 days - afterwards there's not much more we can say about it.
As for how Insights are used to make trades, ultimately this depends on the portfolio and execution models. Many of the default built-in ones liquidate after expiry, but you can change the behavior as desired.
Daniel Trinh
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