CFP^® Eligible; CIMA^®, CPWA^®, CIMC^®, and RMA℠ Pending

Duration: 1 Hour

Option 1: Tuesday, March 9^th at 3:00pm ET

This session will be interactive with the speaker calling on participants to engage in the discussion.

Course Description

Most financial professionals recognize that asset allocation, long a predicate of portfolio construction, dynamics, implementation, monitoring, and rebalancing, is a fundamental determinant of investment risk and return. However, many asset classes are highly correlated and respond to common sources of risk, return, correlation and other characteristics known as investment factors. Long understood as comprising the building blocks of investment performance in academia and the buy-side, factor-based investing is now becoming democratized and increasingly present and available in broader circles. This session will define factor-based investing, present evidence on the existence of factors in returns, and how factors, factor betas, and factor premia may be used to create portfolios and to assess investment performance. Covered will also be how factor-based investing relates to traditional active management, the “new” definitions of alpha and beta, implications for multi-asset class investing, the advent of smart-beta strategies as well as their implications for investing with alternatives.

Learning Objectives:

• Define factor based investing and how it relates to asset allocation
• Explain how factors relate to both active and passive investing strategies
• Explain how factor-based strategies relate to alpha, beta and so-called smart beta and alternative investments
• Describe several practical implementation methodologies for incorporating factor-based approaches into portfolios