How do smart beta ETFs fit in a portfolio?With its cost-effectiveness, smart beta ETFs are ideal building blocks for investors to construct a diversified portfolio by piling on different strategies or styles.
By employing a range of different factors such as price, earnings or yield - smart beta ETFs allow investors to build a strong foundation for their portfolio by providing greater diversification.
This allows investors to complement a range of strategies in their investments to minimise risk and reap higher returns at lower volatility.
For example, you can consider complementing your portfolio needs through an array of smart beta strategies such as dividend factors to provide a measure of stability through consistent dividend pay-outs.
Alternatively if you are feeling more opportunistic, you can employ smart beta ETFs that use momentum factors to capture stocks with the highest price momentum.
Getting Smart with Smart Beta By capturing the best of both active and passive strategies, it is no wonder that smart beta ETFs have become increasingly popular tools for investors today.
Coupled with its low-cost attractiveness, smart beta ETFs can be efficient ways to fill gaps in your portfolio especially if you don’t know whether an active or passive approach works best for you.
Leverage the power of smart beta and find out how you can build a resilient portfolio to ride out volatility in the new normal.