About This Episode

Investing in “smart beta” was the rage in the early 2000s, as small-cap-value stocks vaulted over large-cap-growth stocks. But like all supercharged investment strategies, it didn’t last. Factors premiums have not materialized since the financial crisis. For most of the last decade, value has underperformed growth, driving the underperformance of the largest category of smart-beta strategies. We’ll go over the case for and against factors in this interview with long-term investment adviser, Rick Ferri.

About Our Guest

RICK FERRI, CFA

Rick has been an investment adviser for 35 years and has embraced a low-cost “Bogleheads” investment philosophy for the past 25 years. He does not manage portfolios or sell investment products, although he has done both during his career.

Rick started in 1989 as a Wall Street broker where he relied on commission sales for income. Ten years later, he founded one of the nation’s first low-AUM fee portfolio management companies and quickly grew assets to over $1.5 billion. The firm was purchased by a private equity investor in 2017. Today, he runs Ferri Investment Solutions where he advises do-it-yourself individuals for an hourly rate.

Rick has published extensively on the benefits of low-cost investing, including several books on index funds, ETFs, and asset allocation. He has also written for Forbes and The Wall Street Journal and is the creator and host of the “Bogleheads on Investing” podcast, a program sponsored by the John C. Bogle Center for Financial Literacy, a 501©3 organization.

Rick graduated from the University of Rhode Island with a Bachelor of Science degree in business administration, and from Walsh College with a Master of Science degree in finance. He became a CFA charterholder in 1994. Rick is also a retired Marine Corps officer, and in his glory days flew fighters off aircraft carriers.

Show Notes

Here are a few links to resources:

• Rick’s PowerPoint presentation, “The Case Against Factor Investing”
• Rick’s firm, Ferri Investment Solutions

A message from Advisor Perspectives and VettaFi: To learn more on this and other topics, check out our full schedule of upcoming CE-approved virtual events.