26 questions reported in AQR interviews, organised by the group that asks them. Every question carries a model answer and graded feedback on your own attempt.
Questions
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Hard
Model builds
Built in the spreadsheet grid
Multiple testing, out-of-sample discipline, capacity and decay. 10 questions
A first-round check that a research candidate can separate a strategy outcome from the market outcome it rode along with.
A paper portfolio returns 8% in a month while its benchmark returns 5%. What is the portfolio's active return? Is that enough to call the signal good?
A practical junior-researcher question testing whether you can calculate and interpret a simple rank-based signal diagnostic.
A signal ranks four stocks from strongest to weakest as A, B, C, D. Their next-month realised-return ranks from best to worst are A, C, B, D. Using Spearman rank correlation, calculate the information…
A common first-round check that you can make differently scaled signals comparable before combining them.
A stock's 12-month earnings-revision score is 18. Across the investable universe, the score has a mean of 10 and standard deviation of 4. What is its z-score, and why might a quant researcher use it…
Researchers are expected to explain a simple factor test before writing a complex model around it.
You believe companies with the strongest earnings revisions will outperform. Explain how you would test that idea using decile portfolios. What result would make you interested, and what result would…
Quant research interviews probe statistical judgement over formula recall.
A researcher backtests 200 signals and finds one with a t-statistic of 2.5 predicting next-day returns. Should you trade it? Explain what's wrong and what you'd require instead.
An offer-level research case: interviewers want a decision and a validation plan, not another feature idea.
You inherit a monthly equity signal with a 1.1 gross Sharpe ratio from 2005–2024. It rebalances the full universe, has 180% annual turnover, loses half its Sharpe after estimated costs, and most of…
Quant research interviews hand you output and ask what it means.
You regress a stock's returns on the market and get beta 1.2 (standard error 0.15), alpha 0.3% monthly (standard error 0.4%), and R² of 0.45. What do you conclude?
A research review question after a promising factor weakens in its most recent out-of-sample period.
A cross-sectional equity signal had a strong information coefficient for eight years, but its last 18 months are near zero. How would you decide whether this is noise, a regime change, or a research…
Standard for quantitative research and risk roles.
What are the assumptions behind OLS regression? Which are most frequently violated in financial data, and what do you do about it?
A judgement-heavy research review testing whether you can reject a persuasive model output for the right technical reason.
A machine-learning equity model has a strong backtest and a positive out-of-sample result. But when you rerun it across adjacent training windows, its top feature alternates between a valuation ratio,…
Strategic versus tactical allocation, risk parity and rebalancing rules. 7 questions
Asked because asset labels can hide the same economic exposure.
What does it mean to diversify by economic driver rather than asset-class label?
Asked because client behaviour often fails before long-term expected returns do.
How can a multi-asset manager control drawdowns without simply holding cash?
A regime-aware allocation question after the 2022 inflation shock.
What assets hedge inflation, and what are their drawbacks?
A portfolio construction question for allocation roles.
What is risk budgeting in a multi-asset portfolio?
A portfolio-review case that tests whether an allocator can separate inflation, growth, and real-rate exposures.
Your balanced portfolio has fallen because ten-year real yields rose 100 basis points while inflation expectations barely changed. Equities, long nominal bonds, and long-duration growth stocks all…
A standard multi-asset interview topic, and one with a well-known critique.
Explain risk parity. Why would anyone lever bonds, and what is the main criticism?
The central problem in multi-asset investing, and 2022 made it concrete.
In 2022 both equities and bonds fell sharply. Why did the 60/40 portfolio fail, and what does it mean for diversification?
Business quality, position sizing, benchmark risk and turnover discipline. 4 questions
You are interviewing at an active manager. This question is not rhetorical.
Most active managers underperform their benchmark after fees. Why are you pursuing a career in active management? Make the strongest case, and acknowledge the strongest counterargument.
Asked to test whether you can hold a nuanced view on a politicised topic.
Should ESG factors be part of a fundamental investment process? Make the case on investment merit rather than on values.
Standard in quantitative and multi-manager interviews.
Define the Sharpe ratio. What are its limitations, and what would you look at alongside it when evaluating a manager?
Distinguishes candidates who think about portfolios from those who only think about stocks.
You have 20 high-conviction ideas. How do you decide position sizes? Discuss concentration versus diversification, and how correlation affects your decisions.
Stochastic calculus, VaR and expected shortfall, and model limitations. 3 questions
Quant-risk candidates are expected to translate a correlation assumption into a portfolio-risk estimate without confusing volatility with return.
A portfolio is 50% in Asset A with 20% annual volatility and 50% in Asset B with 10% annual volatility. Their correlation is 0.25. Calculate the portfolio's annual volatility and explain what drives…
Banks and funds use this prompt to assess whether a candidate understands risk beyond normal-distribution statistics.
How would you design a stress test for a multi-asset portfolio? What makes a stress test decision-useful rather than a dramatic set of numbers?
Risk interviews use this question to distinguish a correlation calculation from an understanding of regime risk.
A portfolio manager says two positions are safe together because their trailing three-year correlation is -0.2. Why might that conclusion fail in a crisis, and how would you challenge it?
Expected value under pressure, adverse selection and inventory risk. 1 question
A research discussion at a systematic or market-making firm tests whether your backtest resembles tradeable reality.
You propose a pairs trade that buys the underperformer and shorts the outperformer when two historically correlated stocks diverge. How would you test whether the strategy is real before trading…
Conviction, downside cases and knowing when the work says no. 1 question
Short selling requires different analytical skills. This tests contrarian thinking.
What framework do you use to develop a short thesis, and what are the key elements of a compelling short idea?
Write your answer, get it graded on technical accuracy, completeness and communication, and see exactly which mechanic you missed.
Company tags reflect where a question type is commonly reported in interviews. They are not sourced from, endorsed by, or affiliated with AQR.