The world doesn't need another take on "the value factor."
In contrast Jim Simons gets it exactly right: "Statistic predictor signals erode. It can be five years or 10 years. You have to keep coming up with new things because the market is against us." 25iq.com/2014/07/09/a-d…
In contrast Jim Simons gets it exactly right: "Statistic predictor signals erode. It can be five years or 10 years. You have to keep coming up with new things because the market is against us." 25iq.com/2014/07/09/a-d…
Factor investing enhance returns in a index fund. Enough investors making irrational choices can create a factor that can be arbitraged for a period. The value of that factor can last as long as investors continue to make that irrational choice. That can work until it doesn't.
"Gradually the world wises up. You can run your Geiger counter over the rubble [looking for given factor] and it won't click." So you need to find a new factor.
Or completely change approach by using value as an analytical style (e.g., buy a stock like AAPL at a bargain price)
Or completely change approach by using value as an analytical style (e.g., buy a stock like AAPL at a bargain price)
