@article{BottomUpCapacity,
  author  = {Cartea, {\'A}lvaro and Cucuringu, Mihai and Jin, Qi and Zhu, Jiexiu},
  title   = {Bottom-Up Capacity Constraints and the Limits of Anomaly Profitability},
  year    = {2025},
  month   = nov,
  journal = {SSRN},
  note    = {Available at SSRN},
  url     = {https://ssrn.com/abstract=5797502},
  doi     = {10.2139/ssrn.5797502},
  abstract = {Bottom-up trading strategies exploiting anomalies are subject to capacity constraints that materially affect their profitability. This paper studies how trading capacity limitations alter anomaly returns and identifies fundamental constraints on scalability. We develop a bottom-up framework to quantify how market impact, liquidity, and trade crowding restrict implementable performance, demonstrating that many reported anomalies attenuate or disappear under realistic capacity assumptions.}
}