Posted: 1 Dec 2012 Last revised: 7 Feb 2013
Date Written: November 30, 2012
An increasing number of investors are migrating away from active products towards passive ones such as exchange traded funds (ETFs) and other index-tracking funds, due to their ability to provide beta returns similar to many traditional active managers, but at lower cost. This growing realization that the source of most active managers’ returns is risk premium rather than manager alpha motivates one to create a portfolio of cross asset class index funds and analyse if these index funds are able to capture the risk premia available in the markets in order to generate famous ‘alternative betas’.
Keywords: Alternative beta
Suggested Citation: Suggested Citation
Nehra, Krishna and Favre, Laurent, Quick & Easy Investing: The Alternative Beta Approach Revisited (November 30, 2012). Available at SSRN: https://ssrn.com/abstract=2183114