QUANTIDE LOOP 2026-09-21

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Global Headlines

Is Kimi 3.1 Coming for Mid-Autumn Festival?

On September 19, 2026, Kimi released a string of numbers: 415926535897932384626433832795028841971693993751058209749445923078164062862089986280348253421170679821480865132823066470938446095505822

Concatenating these digits reveals they correspond to the decimal expansion of $\pi$ (pi).

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If you prepend "3.1" to this sequence, it clearly represents $\pi$. Given that Kimi’s previous version was 3.0 and its parent company is Moonshot, it is highly suggestive that Kimi is hinting at a release on the night of the full moon—symbolizing completeness. This leads to the speculation that version 3.1 might launch on or around the Mid-Autumn Festival, September 25.

However, Kimi subsequently deleted this message, making the exact release date of 3.1 ambiguous.¹

Cline’s Generosity: Kimi-K3 Now Free!

Cline currently offers free access to several top-tier models, including DeepSeek-V4.1-Flash, Musespark-1.3, and GLM-5.3-Flash. Recently, they added Kimi-K3 to the free model lineup. On the AA (AI Arena) leaderboard, Musespark-1.3 ranks third, behind only Astra and Fable.

These models are accessible via Cline Desktop or the Cline extension in VS Code. On GitHub, reverse-proxy tools have even emerged to facilitate access. ²

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ChatGPT Tracks Users Across Websites via Ad Collectors

OpenAI has deployed an ad collector named bzr.openai.com within ChatGPT, using a cookie named __obi to track user behavior across domains. Third-party advertisers embedding OpenAI code in ChatGPT and other sites can associate users’ browsing, search, and purchase data with their ChatGPT accounts. The author replicated this mechanism on mobile devices, verifying that 936 ad pixels covered traffic from 1,029 hostnames, revealing how OpenAI’s ad platform, Bazaar, collects data and links it to accounts. ³

Shanghai Futures Exchange: Offset Paper Futures Show Real-World Hedging Value Six Months In

Six months after the listing of offset printing paper futures and options at the Shanghai Futures Exchange (SHFE), their utility for the real economy is becoming evident. Two paper companies in Shandong successfully mitigated price volatility risks through short hedging and options combination strategies. One company achieved a combined futures-spot profit of 150,000 RMB via short hedging, while another reduced procurement costs using options combinations, demonstrating the critical role of derivatives in risk management. ⁵

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Academic Research

High-Frequency Derangement Syndrome: AQR Debunks Common HFT Misconceptions

AQR argues that market narratives often incorrectly assume that past human market-making systems were superior to current high-frequency trading (HFT) systems. The article refutes this, stating that older systems had higher average costs, crashes still occurred, and human market makers did not buy to stabilize markets during crashes. AQR emphasizes that HFT has reduced trading costs and benefited clients, and that public distrust of technology has fueled misconceptions about HFT. ⁵

The Great Divide: Nobel Prize Splits Efficient Market Hypothesis and Behavioral Finance

The Nobel Committee split the Economics Prize between EMH pioneer Eugene Fama and critic Robert Shiller, while also referencing Lars Hansen’s work on the link between asset markets and macroeconomics. AQR notes that early tests of market efficiency and simple asset pricing models performed well, but challenges from value and momentum strategies have complicated the issue of market efficiency. The article argues that academia is divided between rational markets and behavioral finance, but the real world is driven by both rational and behavioral forces, meaning markets are not fully efficient. ⁶

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The Global Breadth of Predictability

This research from AQR Capital Management explores the breadth and distribution of predictability across global markets. As a working paper, it provides investors with an analytical framework to assist in their own assessment of global market predictability and asset allocation decisions. ¹⁰

International Currencies and Capital Allocation

AQR research highlights the significant increase in global capital flows, with foreign investors holding nearly 25% of US corporate debt. Based on data from $27 trillion in global investment positions across 25 countries’ open-end mutual funds from 2003 to 2016, the study finds that investors exhibit a strong home-currency bias, with the vast majority of companies issuing bonds only in their local currency. Exceptions include US bonds, where even small US companies tend to borrow from overseas in dollars, a trend that accelerated after the 2008 financial crisis. ¹¹

Efficiently Inefficient: Explaining the Paradox of the Investing World

AQR Partner Lasse Heje Pedersen published a new book, Efficiently Inefficient, exploring how markets maintain "moderately inefficient" average states to compensate managers for their costs and risks.

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The book integrates theories of efficient and inefficient markets to analyze the thinking and behavioral patterns of professional asset managers, revealing the balance mechanism between average market efficiency and frictions. ¹²

Can Dividend Policy Foretell Earnings Growth?

An AQR working paper challenges the common view that low dividend payout ratios predict high future earnings growth. The study suggests that low payouts may reflect management’s concerns about the sustainability of current earnings or be used for inefficient "empire building," which could actually suppress future growth. Empirical evidence supports a positive correlation between payout ratios and subsequent earnings growth, indicating that historical data does not support the theory that low payouts lead to high growth, posing a challenge to high valuations relying on this expectation. ¹⁴

Causes and Consequences of Margin Levels in Futures Markets

This study uses margin data for 16 commodity futures from 2000 to 2011, finding that the CME typically sets margins at 2.5 times the daily volatility of the contract. The research indicates that raising margins causes market makers and speculators to reduce positions, thereby reducing liquidity and increasing volatility. Data shows that on days when margins are raised, actual volatility increases by an average of approximately 50%.

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The study does not confirm that margin changes affect futures prices but confirms their significant negative impact on market liquidity and volatility. ¹⁵

An Equilibrium Model of Institutional Demand and Asset Prices

This research proposes a new factor-based asset pricing model that links asset prices to institutional holdings, explaining the role of institutions in driving asset price changes. The study combines 1980–2015 SEC Form 13F institutional filing data with CRSP-Compustat data. It estimates portfolio choices and latent demand for six investor types—banks, investment advisors, pension funds, insurance companies, mutual funds, and household investors—based on five factors: market Beta, book-to-market, profitability, investment, and dividend yield. ¹⁸

Quantitative Life

2020 AQR Top Finance Graduate Award Winners Announced

AQR Capital Management and Copenhagen Business School announced the winners of the 2020 AQR Top Finance Graduate Award. This award recognizes PhD graduates with significant practical and academic impact in financial economics. This year marks the eighth edition of the award.

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Winners include six PhD students from Stanford, London Business School, Harvard, Columbia, HEC Paris, and Sciences Po. The judging panel consists of AQR Partner Tobias J. Moskowitz and professors from several top universities. ²⁵

Breaking Barriers, Building Leaders: Women in Quantitative Finance

On March 19, the CMU MSCF New York campus hosted a women in quantitative finance roundtable titled "Breaking Barriers, Building Leaders," co-organized with WiDS. The event was hosted by Angelina Shen of BlackRock, with guests Nancy Davis of Quadratic Capital, Rekha Nair of Société Générale, Amrita Tiwari of New York Life, and Renee Yao of Neo Ivy Capital. Discussions focused on the combination of technical skills and interpersonal agility, emphasizing the critical role of adaptability, confidence, and mentorship in long-term career development. The event provided practical advice for interns and alumni on navigating high-pressure environments and building networks. ²⁶

AQR’s Career Development and Training System for Students

AQR Capital Management offers a "First Semester" onboarding program for new hires recruited through campus hiring, including a three-week intensive camp, up to nine months of training, and over 100 hours of role-specific education.

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Additionally, its internal Quanta Academy runs throughout an employee’s career, offering hundreds of personal and professional development opportunities. ²⁷

Alumni Reflect on CMU MSCF’s 30th Anniversary: Modern Pillars and Practical Orientation of Quant Finance Education

The CMU MSCF program celebrates its 30th anniversary. Alumni Yumi Oh (Class of ’07), Devdeep Sarkar (Class of ’13), and Tony Berkman (Class of ’98) reflect on how the program has shaped the standards of modern quantitative finance education and cultivated technical elites by integrating four top disciplines, real-world projects with industry partners, and cutting-edge tools like machine learning. ²⁸