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The Pros and Cons of Factor Timing

The Pros and Cons of Factor Timing

FromExcess Returns


The Pros and Cons of Factor Timing

FromExcess Returns

ratings:
Length:
16 minutes
Released:
May 17, 2020
Format:
Podcast episode

Description

We are all trained to buy low and sell high, and it is tempting to conclude that we can do the same thing with factors. But the research suggests that factor timing strategies are extremely difficult to implement in practice. In this episode, we discuss the pros and cons of factor timing and look at some of the approaches that investors can use to time factors. 
We discuss:
- Why most investors should avoid attempting to time factors
- The common factor timing approaches, including value, momentum, macroeconomic and dispersion
- Why the ability to control your emotions plays a major role in the ability to successfully time factors
ABOUT THE PODCAST
Excess Returns is an investing podcast hosted by Jack Forehand (@practicalquant) and Justin Carbonneau (@jjcarbonneau), partners at Validea. Justin and Jack discuss a wide range of investing topics including factor investing, value investing, momentum investing, multi-factor investing, trend following, market valuation and more with the goal of helping those who watch and listen become better long term investors.
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https://www.valideacapital.com
FOLLOW JACK
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FOLLOW JUSTIN
Twitter: https://twitter.com/jjcarbonneau
LinkedIn: https://www.linkedin.com/in/jcarbonneau
Released:
May 17, 2020
Format:
Podcast episode

Titles in the series (100)

Excess Returns is an investing podcast hosted by Jack Forehand and Justin Carbonneau, partners at Validea. Justin and Jack discuss a wide range of investing topics, including factor investing, value investing, momentum investing and behavioral finance, with the goal of helping those who watch and listen become better long term investors, all in twenty minutes or less per episode.