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Factor-Based Investing

 
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Leading Investment Management

Put risk to work in your favor

Did you know? Factors drove nearly all excess returns over the past 50 years. Read more in Factor-Based Investing Q&A.

Understanding Factor Investing

An introduction to factors: why have they created excess returns and how can they be combined to be even more effective? 

 
Evaluating the Efficiency of Smart Beta Indices

On average, the most popular smart beta products only captured 17% of the factor they targeted. Our global equity team explains why.

 
Combining Risk Factors for Superior Returns

Strong factors work better when combined because they smooth returns over time. Even more, mixing the quality factor with other factors is especially powerful.

 
What is the Quality Factor?

Quality is the most powerful factor, but the hardest to define. Learn how Northern Trust Asset Management defines it — and how our proprietary quality score precisely targets this valuable factor.

 

Factor-Based Investing Q&A

What is factor-based investing?

Over the past 50 years, research shows that virtually all outperformance in the stock market has been driven by factors*. Investors create factor investments by grouping stocks with similar characteristics such as quality, size, momentum, dividend yields, low volatility and value.

Is factor-based investing the same as smart beta?

Smart beta has become the industry catch-all term for investment strategies that use alternatively weighted approaches, unlike traditional products weighted by market capitalization. While many smart beta products target equity factors by weighting certain underlying company characteristics, they can be inefficient. The best factor-based investing strategies target intended factors, while controlling for unintended risks, to deliver the most efficient factor exposure possible.

*Carhart, Mark M. "On persistence in mutual fund performance." The Journal of Finance 52.1 (1997): 57-82.

 

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    Doug Brown

    Doug Brown

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    Doug Brown

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    Doug Brown is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Western United States, Doug partners with registered investment advisors and financial intermediary advisor relationships by identifying investment solutions to help support and grow their practices. Doug has more than18 years of investment industry experience. Prior to joining Northern Trust, his career began on the floor of the Chicago Board of Options Exchange (CBOE). More recently, Doug has held positions within several distribution channels at ING Funds and Cavanal Hill Funds. Doug is a graduate of the University of Arizona and holds FINRA Series 7, Series 63, and Series 65 licenses.

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    John Cecchino

    Business Development Executive - Northeast
     

    John Cecchino is a Vice President at Northern Trust Asset Management. As the Business Development Executive, John collaborates with registered investment advisors and financial intermediaries in the Northeast. An experienced investment management industry professional, John began his career in 2002. Before joining Northern Trust, he was a Regional Consultant at Thornburg Investment Management. John has held external, hybrid, and internal sales positions at UBS Asset Management, Tocqueville Asset Management, and Principal Financial Group. He earned a BA in Public Relations & Advertising from The Pennsylvania State University and currently holds FINRA Series 7, 63, and 65 securities licenses.

    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

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    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

    Business Development Executive - Southeast
     

    Fernando Muñoz is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Southeast, Fernando partners with registered investment advisors and financial advisors by identifying investment solutions to help support and grow their business. Fernando has more than 25 years of investment industry experience. Prior to joining Northern Trust, his career began as a Financial Advisor at Merrill Lynch. He was later recruited for leadership positions at Smith Barney where he served as a National Training Officer, Sales Manager and Consulting Group Regional Director. More recently, Fernando was a Regional Director at Davis Advisors, a privately held money management firm based in New York. He was responsible for marketing mutual funds and separately managed accounts. Fernando graduated in Finance from University of Texas at Arlington and received his Certified Investment Management Consultant (CIMA) designation from Wharton Graduate School of Business. He also holds FINRA Series 7, 8, and 66 securities licenses.

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    Business Development Executive - Midwest
     
    Cody Poirier is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Midwest, Cody is primarily responsible for RIA and financial intermediary advisor relationships. Cody has more than a decade of investment industry experience. Prior to joining Northern Trust, Cody was Vice President with PAX World Investments responsible for institutional and intermediary business development in the Midwest; a Regional Vice President with Invesco in the Northeast; an internal associate with Calamos Investments in Naperville; and an Equity Trader with Great Point Capital in Chicago. Cody earned a BBA in Finance from the University of Iowa and an MBA in Finance from the Kellstadt Graduate School of Business at DePaul University. Cody holds FINRA Series 7 and Series 66 securities licenses.
    Matt Radano, CIMA®

    Matt Radano, CIMA®

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    Matt Radano, CIMA®

    Matt Radano, CIMA®

    Business Development Executive - Mid-Atlantic
     
    Matt is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Mid-Atlantic Region, Matt is responsible for new business development and client service. He has more than 18 years of investment industry experience. Prior to joining Northern Trust, Matt was the Divisional Vice President and Regional Director for Aria Retirement Solutions. He also spent 10 years at Brinker Capital, where he began as an Investment Consultant, and later became the Regional Director for the Southeast Territory. Matt was a financial Advisor for 5 ½ years at AXA Equitable and began his career with Vanguard helping DC Plan participants. Matt holds FINRA Series 7, 63 and 65 securities licenses. Additionally, Matt is a member of the Investment Management Consultants Association and was awarded its Certified Investment Management Analyst (CIMA®) designation in 2007.
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    Doug Brown

    Doug Brown

    Business Development Executive - West
     

    Doug Brown is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Western United States, Doug partners with registered investment advisors and financial intermediary advisor relationships by identifying investment solutions to help support and grow their practices. Doug has more than18 years of investment industry experience. Prior to joining Northern Trust, his career began on the floor of the Chicago Board of Options Exchange (CBOE). More recently, Doug has held positions within several distribution channels at ING Funds and Cavanal Hill Funds. Doug is a graduate of the University of Arizona and holds FINRA Series 7, Series 63, and Series 65 licenses.

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    John Cecchino

    Business Development Executive - Northeast
     

    John Cecchino is a Vice President at Northern Trust Asset Management. As the Business Development Executive, John collaborates with registered investment advisors and financial intermediaries in the Northeast. An experienced investment management industry professional, John began his career in 2002. Before joining Northern Trust, he was a Regional Consultant at Thornburg Investment Management. John has held external, hybrid, and internal sales positions at UBS Asset Management, Tocqueville Asset Management, and Principal Financial Group. He earned a BA in Public Relations & Advertising from The Pennsylvania State University and currently holds FINRA Series 7, 63, and 65 securities licenses.

    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

    Business Development Executive - Southeast
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    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

    Business Development Executive - Southeast
     

    Fernando Muñoz is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Southeast, Fernando partners with registered investment advisors and financial advisors by identifying investment solutions to help support and grow their business. Fernando has more than 25 years of investment industry experience. Prior to joining Northern Trust, his career began as a Financial Advisor at Merrill Lynch. He was later recruited for leadership positions at Smith Barney where he served as a National Training Officer, Sales Manager and Consulting Group Regional Director. More recently, Fernando was a Regional Director at Davis Advisors, a privately held money management firm based in New York. He was responsible for marketing mutual funds and separately managed accounts. Fernando graduated in Finance from University of Texas at Arlington and received his Certified Investment Management Consultant (CIMA) designation from Wharton Graduate School of Business. He also holds FINRA Series 7, 8, and 66 securities licenses.

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    Cody Poirier

    Business Development Executive - Midwest
     
    Cody Poirier is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Midwest, Cody is primarily responsible for RIA and financial intermediary advisor relationships. Cody has more than a decade of investment industry experience. Prior to joining Northern Trust, Cody was Vice President with PAX World Investments responsible for institutional and intermediary business development in the Midwest; a Regional Vice President with Invesco in the Northeast; an internal associate with Calamos Investments in Naperville; and an Equity Trader with Great Point Capital in Chicago. Cody earned a BBA in Finance from the University of Iowa and an MBA in Finance from the Kellstadt Graduate School of Business at DePaul University. Cody holds FINRA Series 7 and Series 66 securities licenses.
    Matt Radano, CIMA®

    Matt Radano, CIMA®

    Business Development Executive - Mid-Atlantic
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    Matt Radano, CIMA®

    Matt Radano, CIMA®

    Business Development Executive - Mid-Atlantic
     
    Matt is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Mid-Atlantic Region, Matt is responsible for new business development and client service. He has more than 18 years of investment industry experience. Prior to joining Northern Trust, Matt was the Divisional Vice President and Regional Director for Aria Retirement Solutions. He also spent 10 years at Brinker Capital, where he began as an Investment Consultant, and later became the Regional Director for the Southeast Territory. Matt was a financial Advisor for 5 ½ years at AXA Equitable and began his career with Vanguard helping DC Plan participants. Matt holds FINRA Series 7, 63 and 65 securities licenses. Additionally, Matt is a member of the Investment Management Consultants Association and was awarded its Certified Investment Management Analyst (CIMA®) designation in 2007.
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    Alison W. Stewart is a Vice President at The Northern Trust Company, Chicago. She serves in the Mutual Funds Division within Northern Trust Global Investments.

    Prior to joining Northern Trust as a Second Vice President in December 2003, Alison worked for Scudder Investments for nine years, most recently as an Assistant Vice President.

    Alison received a B.S. degree from Bradley University. She holds Series 7, 6 and 63 NASD Securities Licenses and is State of Illinois Life Insurance Certified.

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    Doug Brown

    Doug Brown

    Business Development Executive - West
     

    Doug Brown is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Western United States, Doug partners with registered investment advisors and financial intermediary advisor relationships by identifying investment solutions to help support and grow their practices. Doug has more than18 years of investment industry experience. Prior to joining Northern Trust, his career began on the floor of the Chicago Board of Options Exchange (CBOE). More recently, Doug has held positions within several distribution channels at ING Funds and Cavanal Hill Funds. Doug is a graduate of the University of Arizona and holds FINRA Series 7, Series 63, and Series 65 licenses.

    John Cecchino

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    Business Development Executive - Northeast
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    John Cecchino

    John Cecchino

    Business Development Executive - Northeast
     

    John Cecchino is a Vice President at Northern Trust Asset Management. As the Business Development Executive, John collaborates with registered investment advisors and financial intermediaries in the Northeast. An experienced investment management industry professional, John began his career in 2002. Before joining Northern Trust, he was a Regional Consultant at Thornburg Investment Management. John has held external, hybrid, and internal sales positions at UBS Asset Management, Tocqueville Asset Management, and Principal Financial Group. He earned a BA in Public Relations & Advertising from The Pennsylvania State University and currently holds FINRA Series 7, 63, and 65 securities licenses.

    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

    Business Development Executive - Southeast
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    Fernando Muñoz, CIMA<sup>&reg;</sup>

    Fernando Muñoz, CIMA®

    Business Development Executive - Southeast
     

    Fernando Muñoz is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Southeast, Fernando partners with registered investment advisors and financial advisors by identifying investment solutions to help support and grow their business. Fernando has more than 25 years of investment industry experience. Prior to joining Northern Trust, his career began as a Financial Advisor at Merrill Lynch. He was later recruited for leadership positions at Smith Barney where he served as a National Training Officer, Sales Manager and Consulting Group Regional Director. More recently, Fernando was a Regional Director at Davis Advisors, a privately held money management firm based in New York. He was responsible for marketing mutual funds and separately managed accounts. Fernando graduated in Finance from University of Texas at Arlington and received his Certified Investment Management Consultant (CIMA) designation from Wharton Graduate School of Business. He also holds FINRA Series 7, 8, and 66 securities licenses.

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    Business Development Executive - Midwest
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    Cody Poirier

    Cody Poirier

    Business Development Executive - Midwest
     
    Cody Poirier is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Midwest, Cody is primarily responsible for RIA and financial intermediary advisor relationships. Cody has more than a decade of investment industry experience. Prior to joining Northern Trust, Cody was Vice President with PAX World Investments responsible for institutional and intermediary business development in the Midwest; a Regional Vice President with Invesco in the Northeast; an internal associate with Calamos Investments in Naperville; and an Equity Trader with Great Point Capital in Chicago. Cody earned a BBA in Finance from the University of Iowa and an MBA in Finance from the Kellstadt Graduate School of Business at DePaul University. Cody holds FINRA Series 7 and Series 66 securities licenses.
    Matt Radano, CIMA®

    Matt Radano, CIMA®

    Business Development Executive - Mid-Atlantic
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    Matt Radano, CIMA®

    Matt Radano, CIMA®

    Business Development Executive - Mid-Atlantic
     
    Matt is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Mid-Atlantic Region, Matt is responsible for new business development and client service. He has more than 18 years of investment industry experience. Prior to joining Northern Trust, Matt was the Divisional Vice President and Regional Director for Aria Retirement Solutions. He also spent 10 years at Brinker Capital, where he began as an Investment Consultant, and later became the Regional Director for the Southeast Territory. Matt was a financial Advisor for 5 ½ years at AXA Equitable and began his career with Vanguard helping DC Plan participants. Matt holds FINRA Series 7, 63 and 65 securities licenses. Additionally, Matt is a member of the Investment Management Consultants Association and was awarded its Certified Investment Management Analyst (CIMA®) designation in 2007.
    Emily Meyer

    Emily Meyer

    Business Development Executive – North
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    Emily Meyer

    Emily Meyer

    Business Development Executive – North
     

    Emily Meyer is a Vice President and Business Development Executive at Northern Trust Asset Management. In her role, Emily is responsible for the firms' relationships with bank trust institutions located in the Northern United States. Emily has more than 13 years of investment industry experience.

    Prior to joining Northern Trust, Emily was a Vice President with two boutique investment management firms, one focused on currency strategies and the other on tactical asset allocation portfolios. At both firms, Emily's role was focused on building distribution infrastructure as well as raising capital for their respective asset management products.

    In line with her current responsibilities, Emily began her career at Fidelity Investments where she worked with Bank Trust institutions and Registered Investment Advisors across the country. Emily holds a B.S. from Vanderbilt University, Nashville, TN and an MBA from Bryant University in Smithfield, RI. Emily is a member of the Women in ETFs global leadership team, a women's networking organization in the exchange traded fund industry. She currently holds FINRA Series 7, 63, and 65 securities licenses.

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    Tom Nussbaum

    Business Development Executive – South
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    Tom Nussbaum

    Tom Nussbaum

    Business Development Executive – South
     

    Tom Nussbaum is a Vice President at Northern Trust Asset Management. As the Business Development Executive for the Banking Channel covering the Southern half of the United States, Tom partners with bank trust departments and investment areas to develop solutions that help them meet the needs of their client's.

    Tom has more than 23 years of banking experience. Prior to joining Northern Trust, he has served in the roles of a BDO, SVP Senior Wealth Management Officer running a Community Bank Trust Department and most recently as a Regional Director for Forward/Salient. Tom is a graduate of Lebanon Valley College and a member of their Athletic Hall of Fame, he holds his series 7 and Series 63 licenses.

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    More Insights

     

    Smart Beta Can Carry Unintended Risks
    Are investors setting themselves up for disappointment?
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    Periodic Table of Factors
    No one factor consistently outperforms over time
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    Factor Investing: Not Which, But When
    When should certain factors be favored?
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