What a wild week in the markets. Exchange volumes boggled the mind on Wednesday January 24th – and they weren’t driven by fundamental investors executing buys and sells. So let’s talk briefly about global statistical arbitrage and what it means from (or to) the comfort of your IR chair.

Have you ever wondered why on one day Asian investors cheer US Federal Reserve policy and the next, jeer it? Or why European investors one day zig with US markets and another, zag inversely against them? Market observers and 24-hour news pundits often attribute these curious, seemingly bipolar activities to juking and jiving investor sentiment: “Markets rebounded today on renewed enthusiasm over Fed policy…”

You’ve seen it, right? Well, we submit that most of the time it’s no such thing. Rather, we believe this thrashing can be attributed to global statistical arbitrage, or in the simplest of all terms, the efforts by traders to take advantage of minute speed, time-zone and informational inefficiencies at various planetary market entry points. » Read more: Investor Relations and Global Statistical Arbitrage