Xiao Qiao EAS11 W11 began his career as a researcher while a student in the vaunted Jerome Fisher Program in Management & Technology. Now as a Ph.D. candidate at Chicago’s Booth School of Business, he’s teamed up with brand-name trader Blair Hull to solve the long debate on whether market returns are forecastable. Their answer: yes.
This year, Qiao and Hull penned a paper on return predictability, showing that there is “substantial predictive power in combining forecasting variables.” He and Hull have teamed to put the theory to practical test with an ETF called Hull Tactical US (HTUS). Launched in June 2014, the ETF has seen a 1 percent gain while the markets are down near double-digits—though, of course, Qiao cautions it’s very early days. The ETF’s approach is high returns with low volatility. Qiao’s overall approach is how real-world big data can have big implications for finance.
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