Excess Returns  cover image

The Challenges of Multi-Factor Investing

Excess Returns

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Is There a Right Answer?

There's strong academic evidence both ways. It's really becomes what you're comfortable with. For me personally, I tend to be comfortable with a sleeve approach because I like to see my value stocks be really cheap. But the downside of that is there is somewhat of a canceling effect,. And so do they cancel some of my exposure to the value factor in my value stocks and vice versa? So that's an argument for more of a blended method. Both methods have a lot of data to support them and both methods can work really well.

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