No track error in quants’ Cup picks Quantitative analysis didn’t emerge from the global market meltdown with the best reputation, but last month’s Melbourne Cup may change all that. How, you might ask? Well, Unbalanced received precisely two Melbourne Cup tips from the sell-side this year – one from the Australian equities quant research team at Royal Bank of Scotland (RBS), and another from the equivalent unit at Macquarie Private Wealth. The RBS tip, sent out on the Monday before the race, decided that the weather was too volatile and instead leant heavily on price momentum. Meanwhile, Macquarie Private Wealth started confidently out of the gate, boasting that its strategy of putting a box trifecta on its top six picks, plus backing its top pick for a win, had yielded almost 300 per cent since 2007. Macquarie decided the ‘X’ factors in the 2010 Cup would be sentiment (as expressed in the odds at the TAB) and momentum (the movement in those odds). In any case, both the Macqua­rie and RBS processes spat out a top six which included Americain, Mayluckyday and So You Think in the top three. After dropping all our pocket money on Descarado, which didn’t even finish, Unbalanced thinks we’ll put down the form guide, forget about the bottom-up analysis and go with the pointy-head predictions for next year’s race.