Research preview

Beihai Park in Beijing has just opened the Liuli Pavilion Courtyard, a 300‑year‑old Qing‑Dynasty masterpiece, to the public. The event offers a vivid metaphor for quantitative traders: a rare, valuable asset that suddenly becomes accessible, prompting questions about pricing, liquidity, and the cost of ownership. This article uses the pavilion’s debut to explore core investment concepts such as bid‑ask spreads, mean‑variance efficiency, and arbitrage limits, tying them to practical trading strategies. The Pavilion as an Illiquid Asset When a previously closed cultural treasure becomes available, its market price is initially uncertain. Potential buyers must rely on limited information, leading to a wide bid‑ask spread....