Europe’s fragmented, diverse equity markets may offer a rich source of alpha. Quantitative investment approaches can capitalize on market inefficiencies, systematically generating consistent, scalable alpha.

Key Takeaways 

1 Abundant Alpha Potential 
Europe’s fragmented and diverse equity markets are marked by lower and dispersed informational coverage. These characteristics create inefficiencies, such as complex stock price relationships and a slower price discovery mechanism, which offer active systematic investors abundant alpha generation opportunities.

2 Navigating an Informational Lag 
While Europe potentially offers a rich source for generating alpha, extracting it may prove challenging for certain investment approaches, exemplified by the slower speed of price discovery compared to the US. This creates a situation where alpha is abundant, yet elusive—a challenge we believe quantitative strategies are well placed to overcome.

3 Quant as a Data-Powered Precision Tool 
By leveraging sophisticated data analytics and systematic models, quantitative approaches can efficiently process complex information to identify subtle market inefficiencies and structural dynamics. This precision enables consistent, scalable alpha generation, transforming Europe’s complexity into a systematic advantage.

Read the full article here

Capital is at risk. 
© 2025 Goldman Sachs. All rights reserved. 
461256-OTU-2375547