“I rely far more on gut instinct than researching huge amounts of statistics”
(Richard Branson, Founder of Virgin Group)
Solactive unveils new investment approach: Intuitive Beta™
Intuitive Beta™ is a family of smart beta indices relying on a qualitative framework of intuitive screens. The series is proposing a simple, rules-based approach in which intuition, or our gut feeling, takes a prominent role in defining the passive investment strategy. The aim is thus to offer exposure to a different field of smart beta, which is less data-driven but more focused on common sense. Intuitive Beta™ thus embraces simplicity, intuition and transparency. As Warren Buffet famously said, “Never invest in a business you cannot understand“. We want to make this statement the cornerstone of Intuitive Beta™.
A few examples…
Have you ever wondered what companies such as Du Pont, Walt Disney, Coca-Cola have in common? Aside from being among the 500 largest companies in the US, they are some of the oldest companies around, the “Methuselah” of the US stock market. Since corporate longevity is more the exception rather than the rule, it could be interesting for investors to gain exposure to a basket of “timeproof” companies.
Alternatively, another exciting concept revolves around the idea of workforce efficiency. One of the most valuable resources of a company is its workforce. Bankers, lawyers, doctors, software developers…these are just some examples of labor-intensive jobs where the success of the firm mainly depends on the efficiency of its employees. After all, would you invest in companies with poor processes and unproductive employees?
With Intuitive Beta™, Solactive employs simple explanatory variables of performance as the basis for index strategies.
Stay tuned for more Intuitive Beta™