In focus - Thought Leadership
Five factor investing mistakes - and how to navigate them
It's not been plain sailing for factor investing in recent years, but we've identified some ways to improve the chances of its success.
It’s been a tough period for factor investing. Heralded as the answer to cheap portfolio construction, efficient portfolio management and a simple way to remove unintended factor exposure, factor portfolios have not been performing the way everyone expected.
In this paper, available as a PDF at the foot of the page, we highlight some of the common mistakes to avoid based on our own experience, and how to manage them:
- Mistake #1: Factors no longer work
- Mistake #2: Using too many factors
- Mistake #3: Being too cute when you combine factors
- Mistake #4: "The back-test told me to do it"
- Mistake #5: A factor completion portfolio might compete rather than complete
Find out more in our full paper below.