Part 2/9:
AQR emerged from academic rigor, with three of the four founding partners meeting during their PhD program at the University of Chicago in the 1980s. Their work laid the groundwork for what is now known as factor investing. By exploring concepts such as low versus high multiple stocks and momentum investing, Asness developed his dissertation based on the premise that certain stock characteristics can yield more favorable returns. The firm has since expanded its quantitative methods, integrating machine learning while refining their original academic frameworks.