Hedge Funds

In Brexit trading, machine beats man

In the weeks leading up to the vote, the trading models at many firms adopted a defensive pose

In Brexit trading, machine beats man
Photo: iStockPhoto

Wall Street is tallying up the winners and losers after the severe market reaction to last week’s Brexit vote. One theme has emerged early – the computers got it right and the humans got it wrong.

Part of the reason: Too many investors bet on the outcome they preferred, economists and analysts say, a powerful example of "projection bias" in the markets.

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