Board Diversity and Innovation: International Evidence

By |July 26th, 2021|ESG, Research Insights, Basilico and Johnsen, Academic Research Insight, Corporate Governance|

Board Gender Diversity and Corporate Innovation: International Evidence Dale Griffin , Kai Li , and Ting XuJournal of Financial and Quantitative AnalysisA version of this paper can be found hereWant to read our summaries of academic [...]

The Role of Book-to-Market in Bond Returns

By |July 22nd, 2021|Research Insights, Factor Investing, Larry Swedroe, Fixed Income, Value Investing Research|

My August 17, 2020, article for Advisor Perspectives, “Factor-Based Investing Beats Active Management for Bonds,” provided the evidence from a series of academic papers on the ability of common factors to explain the variation of [...]

Factor Investing in Sovereign Bond Markets: 221 years of evidence!

By |July 19th, 2021|Research Insights, Factor Investing, Basilico and Johnsen, Academic Research Insight, Fixed Income, Value Investing Research, Momentum Investing Research|

Factor Investing in Sovereign Bond Markets: Deep Sample Evidence Baltussen, Martens and Penningaworking paper, 2021A version of this paper can be found hereWant to read our summaries of academic finance papers? Check out our Academic Research Insight category [...]

The Misery Index and Future Equity Returns

By |July 15th, 2021|Research Insights, Larry Swedroe, Academic Research Insight, Behavioral Finance|

Prospect theory was developed by Daniel Kahneman and Amos Tversky in 1979. The theory starts with the concept of loss aversion—the observation that people react differently between potential losses and potential gains. Thus, people make [...]

Maximize ESG exposure or screen out sin stocks?

By |July 12th, 2021|ESG, Empirical Methods, Research Insights, Basilico and Johnsen, Academic Research Insight|

Optimal Strategies for ESG Portfolios Fabio Alessandrini and Eric JondeauJournal of Portfolio ManagementA version of this paper can be found hereWant to read our summaries of academic finance papers? Check out our Academic Research Insight category [...]

Leading EMH Economist John Cochrane Advocates for Advisor Fees

By |July 8th, 2021|Research Insights, Guest Posts, Investment Advisor Education, Behavioral Finance, Active and Passive Investing|

Sorry for the clickbait, but Hoover Institute fellow and “Grumpy Economist" John Cochrane's answers to the seemingly benign question, "How should long-term investors form portfolios," is too important to both advisors and academics to overlook. [...]

The Different Types of ESG Investors

By |July 6th, 2021|ESG, Research Insights, Basilico and Johnsen, Academic Research Insight|

ESG as Waving Banners and as Pulling Plows Meir StatmanJournal of Portfolio Management, 2020A version of this paper can be found hereWant to read our summaries of academic finance papers? Check out our Academic Research Insight category What [...]

Low Volatility Factor Investing: How Investment Horizon Affects Results

By |July 2nd, 2021|Research Insights, Factor Investing, Larry Swedroe, Academic Research Insight, Low Volatility Investing|

Two of the more interesting puzzles in finance are the high beta anomaly (high beta stocks have lower returns) and the IVOL anomaly (stocks with greater idiosyncratic volatility have produced lower returns). These are anomalies [...]

Can Investors Beat Active Mutual Funds with Cheap ETFs, YUP!

By |June 28th, 2021|Research Insights, Basilico and Johnsen, Academic Research Insight, Active and Passive Investing, ETF Investing|

Are Passive Funds Really Superior Investments? AnInvestor Perspective Edwin J. Elton, Martin J. Gruber & Andre de SouzaFinancial Analysts Journal A version of this paper can be found hereWant to read our summaries of academic finance [...]

Private Equity: Is There Anything Special There?

By |June 22nd, 2021|Private Equity, Research Insights, Larry Swedroe, Academic Research Insight|

As the following table demonstrates, since its inception in the 1970s, the private equity industry has grown significantly. According to Preqin data, there are now more than 18,000 private equity funds, with assets under management [...]

Factors Timing is a Difficult Practice

By |June 21st, 2021|Research Insights, Factor Investing, Basilico and Johnsen, Academic Research Insight, Tactical Asset Allocation Research|

Factor Exposure Variation and Mutual Fund Performance Ammann, Fischer and WeigertFinancial Analyst Journal, 2020A version of this paper can be found hereWant to read our summaries of academic finance papers? Check out our Academic Research Insight category What [...]

The Performance of Volatility-Managed Portfolios

By |June 17th, 2021|Volatility (e.g., VIX), Research Insights, Factor Investing, Larry Swedroe, Trend Following, Tactical Asset Allocation Research|

As far back as 1976, with the publication of Fischer Black’s “Studies of Stock Price Volatility Changes” financial economists have known that volatility and returns are negatively correlated. This relationship results in the tendency to [...]

How to NOT Sound like a Washing Machine Salesman on LinkedIn

By |June 15th, 2021|Guest Posts, Investment Advisor Education, Other Insights|

I’m constantly hearing from financial advisors who are getting nowhere on LinkedIn, despite having invested considerable time and money. In this post, I'll provide some guidance on how to avoid sounding like the typical (boring) [...]

Can Hedge Funds Successfully Time Factors?

By |June 14th, 2021|Research Insights, Factor Investing, Basilico and Johnsen, Academic Research Insight, Tactical Asset Allocation Research|

Timing is money: The factor timing ability of hedge fund managers Albert Jakob Osinga, Marc B.J. Schauten, Remco C.J. ZwinkelsJournal of Empirical FinanceA version of this paper can be found hereWant to read our summaries of [...]

Combining Value and Profitability Factors: the International Evidence

By |June 10th, 2021|Quality Investing, Research Insights, Factor Investing, Larry Swedroe, Value Investing Research|

My October 29, 2020, article for Alpha Architect examined the research on the profitability factor. I then reviewed the findings of the June 2020 study “On the Conjoint Nature of Value and Profitability,” which analyzed [...]

Selling a Business? Here are 8 Ways to Minimize Your Taxes:

By |June 8th, 2021|Research Insights, Guest Posts, 1042 QRP Solutions, Tax Efficient Investing|

When an owner sells their business, the IRS and state taxing authorities will be there to take as much of it as they lawfully can. This one sale can lead to the largest tax payment [...]

Still Using Book to Market for a Value Metric? Read This.

By |June 7th, 2021|Research Insights, Factor Investing, Basilico and Johnsen, Academic Research Insight, Value Investing Research|

Going by the Book: Valuation Ratios and Stock Returns Choi, So and WangWorking Paper, 2021A version of this paper can be found here.Want to read our summaries of academic finance papers? Check out our Academic Research Insight category [...]

This Time is Different? Consider Quantifying Subjective Priors

By |June 4th, 2021|Empirical Methods, Research Insights, Guest Posts, Academic Research Insight, Behavioral Finance|

This time is different. --John Templeton "This time is different," is a sentiment that leads many investors to stray from using data analysis in their investment decision process and more towards discretionary judgment.  The logic [...]

Get Green or Die Trying?

By |June 1st, 2021|ESG, Research Insights, Basilico and Johnsen, Academic Research Insight|

Get Green or Die Trying? Carbon Risk Integration into Portfolio Management Maximilian Görgen, Andrea Jacob, and Martin NerlingerJournal of Portfolio ManagementA version of this paper can be found hereWant to read our summaries of academic finance [...]

The Explanatory Power of Factor Momentum

By |May 27th, 2021|Research Insights, Larry Swedroe, Momentum Investing Research, Tactical Asset Allocation Research|

Momentum is the tendency for assets that have performed well (poorly) in the recent past to continue to perform well (poorly) in the future, at least for a short period of time. review more in [...]

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