Smart beta: too good to be true?

Bruce I. Jacobs and Kenneth N. Levy
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Bruce I. Jacobs: Jacobs Levy Equity Management
Kenneth N. Levy: Jacobs Levy Equity Management

Journal of Financial Perspectives, 2015, vol. 3, issue 2, 155-159

Abstract: Smart beta strategies promise to deliver market-beating returns with simplicity and low cost, but the reality is more complicated. Contrary to popular perception, smart beta strategies are neither passive nor well diversified. Nor can they be expected to perform consistently in all market environments. Perhaps most importantly, because of their focus on only a limited number of factors, smart beta strategies fail to exploit numerous potential profit opportunities.

Keywords: Smart; beta (search for similar items in EconPapers)
JEL-codes: G10 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:ris:jofipe:0080

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