latamen
Factor investing case studies – the merits of tailor made solutions

Factor investing case studies – the merits of tailor made solutions

06-07-2016 | Research

Factor investing – the investment strategy that aims to capture 'hidden' returns in financial markets – is rapidly gaining in popularity. However, it is important to follow the right factors, and to be wary of one factor counteracting another, to get the best results. Otherwise, investors might follow generic factor strategies that expose them to risks that are not properly rewarded, resulting in inferior performance.

  • Joop  Huij
    Joop
    Huij
    Portfolio Manager, Head of Factor Investing Equities and Factor Index Research

Since 2005, the Robeco Quantitative Research team has concentrated on analyzing, evaluating, and designing factor strategies that deliver more stable and consistent returns in the long run. We have long believed in the benefits of the evidence-based approach that true factor investing requires. Based on this philosophy, we have been able to give our clients access to portfolios with systematic exposure to a range of factor premiums for well over a decade. It has created a mini-industry within asset management that has won many converts.

Now it is time to take stock of how factor investing is being used, and sometimes, misused. Although some investors are already actively using factor investing strategies, others are still pondering whether they should use multiple factors across all their portfolios. Their more wary approach is justified as factor investing is not a one-size-fits-all investment phenomenon.

A strategic allocation to factor premiums is not only dependent on our evidence-based investment philosophy, but also on a careful assessment of a client’s specific needs. In some cases, fund solutions or tailored mandates may not always be the best structures to meet these needs.

In this publication, we address these challenges by looking at the lessons learned from our experiences with clients who have incorporated factor investing into their portfolio allocation strategies. We present three case studies of professional investors who are successfully implementing bespoke multi-factor solutions – a Dutch pension fund, a large sovereign wealth fund and a retail bank. These clients’ bespoke multi-factor solutions offer valuable insights for all.

Benefit from factor investing
Benefit from factor investing
Discover the essentials of factor investing
Read more

Leave your details and download the report.

Disclaimer:

This report is not available for users from countries where the offering of foreign financial services is not permitted, such as US Persons.

Your details are not shared with third parties. This information is exclusively intended for professional investors. All requests are checked.

Important information

The Robeco Capital Growth Funds have not been registered under the United States Investment Company Act of 1940, as amended, nor the United States Securities Act of 1933, as amended. None of the shares may be offered or sold, directly or indirectly in the United States or to any US Person.

This website is intended for use only by non-U.S. Persons outside of the United States (within the meaning of Regulation S promulgated under the Securities Act of 1933, as amended (the “Securities Act”)) who are professional investors. By clicking “I Agree” below and accessing the information on this website, including any subdomain thereof, you are certifying and agreeing to the following: (i) you have read, understood and agree to this disclaimer, (ii) you have informed yourself of any applicable legal restrictions and represent that by accessing the information contained on this website, you are not in violation of, and will not be causing Robeco or any of its affiliated entities or issuers to violate, any applicable laws and, as a result, you are legally authorized to access such information, (iii) you understand and acknowledge that certain information presented herein relates to securities that have not been registered under the Securities Act, and may be offered or sold only outside the United States (within the meaning of Regulation S under the Securities Act) and only to, or for the account or benefit of, non-U.S. Persons (within the meaning of Regulation S under the Securities Act), (iv) you are a non-U.S. Person (within the meaning of Regulation S under the Securities Act) located outside of the United States (within the meaning of Regulation S under the Securities Act) and (v) you are a professional non-retail investor.

Access to this website has been limited so that it shall not constitute directed selling efforts (as defined in Regulation S under the Securities Act) in the United States.

Nothing contained herein constitutes an offer to sell securities or solicitation of an offer to purchase any securities in any jurisdiction.

We reserve the right to deny access to any visitor, including, but not limited to, those visitors with IP addresses residing in the United States.

This website has been carefully prepared by Robeco Institutional Asset Management B.V. (Robeco). The information contained in this publication is based upon sources of information believed to be reliable. Robeco is not answerable for the accuracy or completeness of the facts, opinions, expectations and results referred to therein. Whilst every care has been taken in the preparation of this website, we do not accept any responsibility for damage of any kind resulting from incorrect or incomplete information. This website is subject to change without notice. The value of the investments may fluctuate. Past performance is no guarantee of future results. If the currency in which the past performance is displayed differs from the currency of the country in which you reside, then you should be aware that due to exchange rate fluctuations the performance shown may increase or decrease if converted into your local currency. For investment professional use only. Not for use with the general public.
I Disagree