Scientific Beta

Professor Stoyan Stoyanov, Head of Research at EDHEC Risk Institute—Asia, was invited to take part in the IMAS Lunchtime Talk Series on 27 November, 2013 in Singapore, where he presented the Smart Beta 2.0 approach to an audience of IMAS members.

Professor Stoyan Stoyanov, Head of Research at EDHEC Risk Institute—Asia, was invited to take part in the IMAS Lunchtime Talk Series on 27 November, 2013 in Singapore, where he presented the Smart Beta 2.0 approach to an audience of IMAS members.

Recent years have seen increasing interest in new forms of indexation, referred to as Smart Beta strategies. Investors are attracted by their performance compared to the traditional cap-weighted indices. However, by departing from cap-weighting, Smart Beta equity indices introduce new risk factors for investors. In addition, the Smart Beta market appears to be inefficient today, due to restricted access to information and lack of independent analysis. Smart Beta 2.0 is a new approach that allows assessing and controlling systematic risk, strategy specific risk, and tracking error. It provides better building blocks for active asset allocation and portfolio construction.

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