Introduction to FinTech Using R - A Growth Strategy

The video tutorial discusses the growth strategy in asset pricing, originating from Carhartt's 1995 paper. It covers the setup of data, calculation of return data, and implementation of a growth strategy using dynamic programming. The performance of the strategy is evaluated through OLS regression and visualizations, highlighting its potential to outperform the market. The tutorial concludes with a summary of the strategy's implications and media influence.

Who are considered the grandfathers of modern finance and behavioral finance?

• Carhartt and Eugene Fama

• Eugene Fama and Kenneth French

• Carhartt and Kenneth French

• Eugene Fama and Robert Shiller

What does the UMD factor stand for in asset pricing?

• Up Minus Down

• Upward Market Demand

• Under Market Development

• Uncertain Market Dynamics

In the coding process, what is the significance of defining '20' in stock data?

• It is used to calculate annual returns.

• It is a placeholder for weekly data.

• It represents 20 business days, essentially a month.

• It represents 20 calendar days.

What is the risk of having too few stocks in a portfolio?

• The risk will be small.

• The return will be small.

• The portfolio will be more diversified.

• The return will be huge, but so will the risk.

What statistical method is used to evaluate the performance of the growth strategy?

• OLS regression

• Time series analysis

• Factor analysis

• Monte Carlo simulation

How much does the growth strategy beat the market annually according to the video?

• 5%

• 20%

• 10%

• 15%

What is the purpose of the rebase function in the visualization?

• To adjust the starting value to $1.00

• To calculate the average return

• To compare different strategies

• To highlight the best performing stocks

What does the media often misinterpret about the growth strategy?

• It always beats the market by a large margin.

• It never beats the market.

• It is a high-risk strategy.

• It only works in bull markets.

What is the main benefit of the growth strategy according to the video?

• It is easy to implement.

• It generates significant alpha for investors.

• It minimizes risk.

• It requires minimal data.

What is the role of the Dgraph library in the video?

• To download stock data

• To visualize the growth strategy and market benchmark

• To perform statistical analysis

• To calculate the Sharpe ratio