Skip to main content

Factors: Ain’t Misbehavin’

By: ETFdb
Prepared by Scott Opsal Investment styles generally have an inherent tendency to outperform in either bullish or bearish market environments. One cohort attracts buyers when the equity market is running higher and optimism prevails, while other styles draw interest when the market is weak, worry abounds, and safety is the desire of the day. Such a behavioral bias is built into some factors by design, others accrue their directional bias as a secondary result of economic or cyclical forces. There is no “official list” of bullish or bearish factors, so we must infer these tilts by examining style performance during periods when the market is exhibiting clear signs of bullish or bearish sentiment. The pandemic-induced swings during 2020 were exceptional in their speed and magnitude, providing excellent data points for analyzing style performance during extreme phases of market movements. The year also experienced a third window of acute style performance following Pfizer’s announcement of an effective COVID-19 vaccine, and we examined all three moves in a search for style and factor tendencies. We also studied the 2016-2019 market cycle that provided three additional market swings for consideration.
Data & News supplied by www.cloudquote.io
Stock quotes supplied by Barchart
Quotes delayed at least 20 minutes.
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.