Industry Updates

Beyond Beta - available now

Scott Longley


The second edition of Beyond Beta is now available.

Click here to subscribe to the quarterly publication.

Welcome to the first edition of Beyond Beta.

Click here for the link for the PDF.

If you don't know what smart beta is, the basic idea is that a smart beta fund is a passive fund that follows a particular investment style such as value, size or momentum. These styles are often known as factors, so 'smart beta' is also known as factor-based investing.

The future

It looks almost inevitable that there will be further substantial growth in the smart beta sector in the years ahead, and that's why a new independent publication is so needed. We hope that 'Beyond Beta' will fill that gap and the first edition looks very strong.

Articles include a history of smart beta as well as a piece by Angelo Ranaldo and Rainer Haeberle which argues that most ETF indices offer active investing on the sly and that applies to smart beta indices. You can also read why equal-weighted indices (where stocks all have the same weighting in an index) outperform market-cap weighted indices. Apparently equal-weighted indices decline more in bear markets, but they beat their market-cap weighted peers in bull markets.

We also have an article outlining the sceptic's case against smart beta - entitled 'why smart beta is a fraud.' Richard Wiggins argues that many smart beta indices are built on 'pseudoscience' and that many smart beta ETFs can be recreated using cheaper alternatives.


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