FT Wilshire Pure Factor Indexes allow precise control of targeted and off-target exposures, resulting in a greater degree of factor purity and investability.
Academic research has demonstrated that factors such as Value, Momentum, Quality, Low Volatility and Size determine the return of diversified portfolios. Long term exposure to these factors leads to performance benefits - both long and short-term risks exist when factor exposures are not properly controlled or ignored.
To gain access to their associated long-term risk premia via an inexpensive index vehicle
To easily implement factor allocation decisions when market conditions change
To manage long and short-term portfolio risk
Our factor tilting methodology allow indexes to be created with large on-target exposure while simultaneously neutralizing any off-target exposure. This results in a more pure and investible product, and can also be used to the control other important exposures such as those relating to Sustainable Investing.
