Thread by @pyquantnews

There are 137,000 Python libraries.

But you only need 11 for quant finance:

pandas

• Allows quick data cleaning and preprocessing
• Provides DataFrame structure for time-series data
• Enables complex data operations with simple syntax

Use it for:

Manipulating and transforming financial market data.

NumPy

• Advanced statistical functions for analysis
• Efficient vectorized operations for large datasets
• Powerful random number generators for simulations

Use it for:

Fast and versatile scientific computing.

SciPy

• Advanced stats and hypothesis testing
• Linear algebra for portfolio optimization
• Efficient numerical routines and model calibration

Use it for:

Optimization and calibration.

Matplotlib

• Integrates with pandas
• Plot financial time series data
• Generate histogram, scatter plots

Use it for:

Fast plotting of market data and summary statistics.

Statsmodels

• Hypothesis testing to test trading strategy efficacy
• Regression analysis for factor analysis and hedging
• Time series analysis with ARIMA and VAR models for forecasting

Use it for:

Regression and statistical analysis.

vectorbt

• High performance to run millions of simulations
• Flexible using NumPy and pandas under the hood
• Easy to use once to get up and running fast

Use it for:

Prototyping trading strategies and optimizing parameters.

Zipline Reloaded

• Create custom data pipelines
• Backtest strategies with realistic data
• Access a vast array of trading algorithms

Use it for:

A realistic market simulation for backtesting.

PyFolio Reloaded

• Detailed portfolio risk analysis
• Integrates with Zipline for backtesting
• Supports custom tear sheets for personalized analytics

Use it for:

Risk and performance metrics.

AlphaLens Reloaded

• Visualizes key metrics effectively
• Robust statistical analysis of factors' long-term trends
• Streamlines performance analysis of predictive alpha factors

Use it for:

Alpha factor analysis.

OpenBB

• Access financial market data from one place
• Fast Terminal environment for investment research
• SDK for programmatic access to all OpenBB functions

Use it for:

Research and data acquisition.

RiskFolio-Lib

• Optimize asset allocation with 20+ risk measures
• Perform scenario, stress testing, and backtesting
• Tools for risk budgeting and risk contribution

Use it for:

Advanced portfolio optimization and risk management.

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