FORECASTING IN FUNDAMENTAL L/S EQUITY

It is painful to see fundamental long/short analysts with decades of experience rely on regressions or overly simplistic assumptions to make forecasts.

Even worse, many omit important fundamental factors when building their projections.

Making forward projections is one of the most important aspects of the job and is a highly analytical, deeply fundamental process.

Quants or systematic PMs often talk about using different types of regressions and more recently AI agents to iterate and identify the combination of models with the highest predictive accuracy for a given KPI. But you are not a quant. Your competitive advantage is being a fundamental investor, so be that.

While we often talk about using the model to quantify your variant view, you can also build incredible variant views just by going through the full end-to-end fundamental process of making a forecast.