Considering risk from a factor perspective

When it comes to investing, “risk” is often defined as volatility. In fact, the biggest risk is making the wrong asset allocation decisions, or being on the wrong side of long-term trends. We’ve heard a lot about bubbles in the recent past but in my mind there has not been enough discussion about potentially the biggest bubble: the valuation of equity markets more broadly.

Digging deeper into equity markets, value and quality are the most dominant factors in the long run and should form a large component of a strategic equity allocation. Consideration of these two factors together paints a more nuanced picture for investors than overall market analysis might suggest.


  • Equities
  • Quantative Equity Products
  • Value
  • Growth
  • Inflation
  • Perspektywy

The views and opinions contained herein are those of Schroders’ investment teams and/or Economics Group, and do not necessarily represent Schroder Investment Management North America Inc.’s house views. These views are subject to change. This information is intended to be for information purposes only and it is not intended as promotional material in any respect.