Factor Investing
Value Factor
Definition
What is Value Factor?
The tendency for relatively cheap securities to perform differently from expensive securities over time.
Example in practice
How This Looks in Practice
The strategy ranks shares by earnings yield and price-to-book.
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Related Terms
Factor Investing
Factor Investing
An approach targeting broad, persistent return drivers such as value, size, momentum, quality, or low volatility.
Factor InvestingSize Factor
The return pattern associated with smaller companies relative to larger companies.
Factor InvestingMomentum Factor
The tendency for recent relative winners and losers to continue their trends for a period.
Regulation & ComplianceFiduciary Duty
A legal or ethical duty to act loyally and carefully in another person's best interest.