Is There a True Factor or Not?

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I love that you related that back to Warren Buffett's success because we talk about Warren Buffett's strategy a lot on our show. That's actually what our flagship show was founded on was studying Warren Buffett's investment principles and his success. And so I've been talking I've introduced factor investing on the show a little bit already. So our listeners are kind of familiar with factors and how it works. In your book, you talk about what makes a factor a true factor or notBecause academics have been coming up with so many factors now over the years to try and explain the differences and returns,. You cover five rules that a factor needs to meet for you to invest in it.

IN THIS EPISODE, YOU’LL LEARN:

06:00 - The key to a winning investment strategy.
12:02 - What percentage of stocks actually outperform the market?
14:08 - Why active strategies such as active management, stock picking and market timing are “losing strategies”?
24:01 - Do markets value stocks correctly?
28:09 - Disentangling market efficiency with the concept of current valuation.
33:54 - How Warren Buffett’s outperformance can be explained by factors.
38:45 - How investors can improve their long run returns through factor investing.
39:12 - The 5 rules factors must meet to invest in them.
60:12 - Larry’s guide on how to think about allocating your portfolio between investing in US equities vs International equities vs Emerging Market equities.
67:18 - Why all factor ETFs are not created equal and which are best to invest in?
67:18 - The 3 characteristics to look for when comparing factor ETFs.
01:10:18 - How long you have to hold these investments to earn the expected premium?
And much, much more!

*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.

BOOKS AND RESOURCES

Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Kyle and the other community members.
Check out Larry’s Book: The Only Guide to a Winning Investment Strategy You'll Ever Need.
Check out Larry’s Book: Think, Act, and Invest Like Warren Buffett: The Winning Strategy to Help You Achieve Your Financial and Life Goals.
Check out Larry’s Book: Investment Mistakes Even Smart Investors Make and How to Avoid Them.
Check out Larry’s Book: Your Complete Guide To Factor-Based Investing.
Check out Larry’s Book: The Incredible Shrinking Alpha: How to be a successful investor without picking winners.
Check out: Buckingham Wealth Partners.
Check out Larry’s writings: Alpha Architect.
Related Episode: High Returns From Low Risk Investing w/ Pim Van Vliet - MI221.

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