Mangal Keshav Group promoter Chintan Bhagat has developed a quant-based trading technology which works on all asset classes such as equities, commodities, currencies and bonds.
Bhagat owns SkyFire Capital, LLC , a Delaware based Global Macro Hedge Fund which trades on the Chicago Board of Trade, Comex and CME trading futures of Gold, Crude Oil, S&P 500, Currency Futures and the U.S. 10 year Treasury Note)
"This trading technology has 70-80 per cent success ratio. The technology guides not only in volatile but also sideways kind of markets," said Chintan Bhagat, the fourth generation entrepreneur and Promoter of Mangal Keshav.
Differentiating quant-based technology from the algo trade, Bhagat said: "The algorithm is based on statistics calculus and probabilities. Our technology picks up price volume and market activity/participation on real time basis and predicts future price movement. This is a real-time algorithm so it helps instant decision making as the system monitors changes minute by minute."
In comparison to other algorithms that tend to work well in certain market conditions and completely fail in others the algorithm performs consistently.
While other algorithms rely on a logic such as Elliot Wave Theory as a precondition to work, the algorithm only uses price and volume as the inputs into the formula. Since these inputs (price and volume) will continue to exist at any point of time, the algorithm becomes self-adapting and works perfectly in all market conditions.
"Although the algorithm is automatic, it still requires our discretion and that is the beauty of the programme," he added.
Until now, Mangal Keshav uses the technical analysis and discretion based on fundamental analysis.
Hedge funds across the world have some technology which they call their "Blackbox" and do best to protect its secrecy, so it is hard to say exactly what others have.
"However, our algorithm is one of a kind and has been developed from scratch. Probably no one has a similar algorithm. The algorithm gives the ability to look at the market with a different lens that helps objectively see it compared to any other technology," Bhagat added.
From a modest beginning of managing close to Rs 100 crore, the company today manages a portfolio of Rs 330 crore across asset classes in just three years.