The Contrarian Investor: The need for a quantitative fightback

I have been known to write the odd column for other publications, not least the pink one, where last weekend I was holding forth on the subject of smart beta and why retail investors in particular need to tread carefully.

In simple terms, I see the whole smart-beta bandwagon as a positive way of democratising access to good old-fashioned quantitative investing ideas ie, a focus on value or quality, or even momentum, in a lower-cost fund vehicle. The bad news is, as this sector becomes hijacked by marketers and sold on to unsophisticated investors, we will run into an information and a blame game asymmetry. Factor styles The first challenge is all the styles of factor investing are necessarily complicated, vary in definitional scope between index originators, and require a genuine understanding of why...