Spencer Greenberg, the hedge fund manager of Rebellion Research, runs an admittedly very small $7 million fund.
But in a video office tour and interview yesterday, Greenberg used a really simple, easy to understand example to explain how the algorithmic system Rebellion uses, “Star,” runs on “artificial intelligence.
It’s like a really smart elevator.
“The elevator might record all of the history about everyone who’s rang for it, what time of day, what day of the week, what floor, and so forth. And it would automatically infer the optimal place for it to be at every point in time during the day.”
So that’s kind of how “Star” works.
They teach it complex formulas then each day, it’s given reams of market and financial data to ingest. then it stays up all night applying the new knowledge to Rebellion’s portfolio. In the morning, Star comes up with a list of trades it wants to execute. Those are then reviewed by a human, and executed. Rebellion never strays from what Star tells it to do.
Read more about Rebellion here (like how it’s run by a few guys in their twenties).