FYI: Financial planner Robinson Crawford has invested his entire individual retirement account in just four exchange-traded funds tracking cheap stocks as well as hot ones in the U.S. and overseas. His logic: Academic research indicates that stocks possessing value and momentum qualities, or “factors,” do well, so why not invest solely in them? He wouldn’t dare adopt that approach for his clients, however. “It’s a high volatility strategy,” says the 28-year-old founder of Montebello Avenue, a Scottsdale, Ariz.–based advisory firm. “You’ve got to really understand what you’re buying.”
Unfortunately, most investors can’t understand because too many factor-based products have flooded the market. According to Morningstar, there are 771 factor ETFs and mutual funds, with more than $1 trillion in assets.
Regards,
Ted
https://www.marketwatch.com/articles/etf-factor-investing-51556906251?mod=barrons-on-marketwatch
