Intensifying the Search for Alpha

As the playing field levels out, firms are seeking new ways to gain competitive edge, which must be comprehensively back-tested. By Mitch Abeyta, managing director, and JP Tremblay, senior director of product development at Standard & Poor's Compustat

Finding Alpha used to be relatively easy, a client recently told us. Only a few years ago, a hired student would write a program that read magnetic tapes of financial data, which—after a laborious process—would manage to strip out dividends and