Summarising recent empirical evidence on equal sector-weighted portfolios in the UK.VIEW
Garrett, Bernd and Andrew have all featured in a variety of articles, essays and videos, which you can access here:
Here are some educational videos which we’ve made or featured in, which help to explain some of the principles which make up our investment approach:
GSI – Beyond the Cap-Weighted Index
Dr. Nick Motson of Cass Business School discusses issues with investing in market-weighted index portfolios, which tend to be heavily concentrated in a small number of mega-cap stocks. Alternative, more diversified approaches have generated superior risk-adjusted returns in the past, mostly due to their exposure to value and size factors.
A Dummy’s Guide to Smart Beta, part three*
The term “beta” was first introduced by Nobel Laureate William Sharpe in the 1960s. In simple terms, it denotes the risk of the stock market. But in the intervening half a century, several other risk factors have been identified and quantified. Features Garrett and Bernd on GSI’s model, which increases diversification in a cap-weighted portfolio to smooth out the highs and lows.
Passive Investing Theory, part four: Portfolio Theory*
Diversification has been called ‘the only free lunch in investing’ and is the driver behind Portfolio Theory, developed in 1952 by Harry Markowitz and later expanded upon by William Sharpe in his Capital Asset Pricing Model, and Eugene Fama and Kenneth French in their Three Factor Model. With contributions from Garrett and Bernd.