Why does IMI use a quantitative approach?
A. IMI is a fundamentally based, quantitative investment manager. This means our approach relies on financial relationships that are extracted from balance sheet, cash flow and income statement line items. We also take into account estimates from sell side analysts and historical price behavior. Although we share some similarities with purely fundamental investment managers, we have a number of significant differences. First, we quantify the predictive ability of each factor that is included in our process. Financial statements offer a multitude of factors to judge a companys profitability, valuation, efficiency and risk characteristics. However, only a subset of these relationships is predictive of price behavior. Since our focus is excess return generation, we concentrate on relationships that have demonstrated a consistent historical ability to predict price behavior. By using such an approach, we are better able to distinguish between information that could be interesting but usele
