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A new way to beat the market

The smart beta revolution

By Rob Davies  

Many investors now accept the harsh reality that trying to beat the market is expensive, risky and time-consuming. They might achieve it but the returns are modest, compared to the risk involved with producing them, and the professionals’ time is probably better deployed elsewhere. Grudgingly they capitulate to the logic of index investing. Popular indices such as the FTSE 100, the 250 or All-Share are all based on market capitalisation—the weight of each stock on the index is determined by multiplying the share price by the number of shares outstanding. This…

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