The Benefits of Factor Investing

factor investing is a process of choosing investments based on specific factors that are believed to be associated with higher returns. Here are some common factors that people think about company size, growth, valuation and profitability. US large cap US growth has outperformed large cap US value to the extent of 400% relative to about 265%. But if you were someone who thought value was going to be the factor that you should lay onto, maybe you would not be quite as happy as those growth investors.