Ten Misconceptions about Smart Beta

Noël Amenc, Frédéric Ducoulombier, Felix Goltz, Jakub Ulahel: The objective of this paper is to review ten common but mistaken claims about Smart Beta, and to shed light on the underlying issues.

Author(s) :

Noel Amenc

Professor of Finance, EDHEC-Risk Institute, CEO, ERI Scientific Beta

Frederic Ducoulombier

Associate Professor of Finance, EDHEC-Risk Institute, Corporate Director, ERI Scientific Beta

Felix Goltz

Head of Applied Research, EDHEC-Risk Institute, Research Director, ERI Scientific Beta

Jakub Ulahel

Quantitative Equity Analyst, ERI Scientific Beta

Presentation :

Smart Beta strategies, as one of the strongest growth areas in investment management recently, have established a space in between traditional (cap-weighted) passive investments and traditional (proprietary and discretionary) active management. Perhaps unsurprisingly, Smart Beta has drawn fierce criticism from both advocates of traditional active management and of traditional passive management. In a nutshell, proponents of proprietary active strategies complain that Smart Beta is not active enough while proponents of traditional cap-weighting say that Smart Beta is not passive enough. Smart Beta providers have not only responded to such criticism, but have also been vocal about the benefits of their respective approaches, without necessarily agreeing with one another. Such debates have too often led to misconceptions.

Pdf
Ten Misconceptions about Smart Beta...
(5.03 MB)
Type : Position paper
Date : le 13/06/2016
Extra information :

For more information, please contact EDHEC Research and Development Department [research@drd.edhec.edu]

Research Cluster : Finance

See Also

The Economist Master in Management ranking:  EDHEC ranks in the Top 3 French business schools
- 25-05-2017
EDHEC Business School is included in The Economist’s, highly selective and demanding,...
Michelle Sisto appointed Associate Dean for Graduate Studies
- 22-05-2017
EDHEC Business School announces the appointment of Michelle Sisto as Associate Dean for...
2017 Financial Times Executive Education rankings: EDHEC gains 7 places and enters the top 30 worldwide
- 15-05-2017
After making strong progress in the two individual rankings, EDHEC Business School...
- 06-04-2017
This week, to bring current and future challenges facing leaders directly to the classroom, the EDHEC Global MBA launches two 18-hour core courses devised and taught in collaboration with...