Best factor (smart beta) indices 2024 | How to get more out of index investing

Index investing has multiple advantages like low cost, less management and simplicity. But if you would like it to be more powerful, you can explore factor or smart-beta indices. These indices are obtained after applying certain criteria to mainstream indices or universes. So, they combine active and passive investing.
While there are numerous factor indices, only 7 are useful from an investment perspective. In this video, we have analysed these 7 factor indices. They are as follows:
- Nifty Alpha 50
- Nifty Alpha Low Volatility 30
- Nifty50 Value 20
- Nifty100 Low Volatility 30
- Nifty100 Quality 30
- Nifty100 Equal Weight
- Nifty50 Equal Weight
We have compared their risk, return and risk-adjusted performance with their parents or the closest available indices. Three out of these seven indices didn’t make the mark, so they were removed. The remaining four factor indices have performed well. You can watch the video to find out what these indices are.
We have also analysed each of these 4 indices in greater detail so that you can pick the right one for you.
Link to the video on the Nifty LargeMidcap 250 index: • Nifty LargeMidcap 250 ...
Chapters
00:00 Introduction
01:25 What is factor investing?
03:47 Hunting for the best factors
05:17 Performance comparison of factor indices
08:41 Which factor index should you go for?
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[@geopaul6178]

Our investments are long term. But investment advices will keep on changing in every year.😅

[@praveenkumartampuluri2859]

Exactly what iam thinking😂😂

[@sudeeptapanda4876]

Yes Agree with you. As index fund is now a days getting more focus and in top of that these smart beta funds logic coming up every quarter so financial analysts must be having tough time to choose and recommend 😂. What I believe is we should have mix of funds (active /passive/smart beta etc)from different investment strategies/style like we care about our portfolio diversification across market caps while building our portfolio 😊

[@geopaul6178]

I am Index fund investor.

[@ETMONEY]

Hello, our effort is to bring to you various investment perspectives so that you can decide what's best for you. Also, any investment analysis can't be permanent. As data changes with time, the analysis also has to be updated. That's why, from time to time, we bring to you updated analyses.

[@1986chanu]

If this is the case y dont u have them as part of your genius portifolios. Any specific reason y u continue to choose the amcs standard index funds.

[@Abc13364]

No discussion on Nifty 200 momentum 30 and nifty midcap 150 quality 30, in one of your old ET money video in which u said momentum 30 index has beaten nifty 50 index in 9 year calendar.

[@varunbhati7428]

N 200 mom 30 Index has beaten Nifty for all time but it also falls more at crash time....

[@varunbhati7428]

Freefincal had a nice video about it N200 M 30 Index fund

[@jayaramans7398]

Shankarnath provided great video on it

[@varunbhati7428]

@@jayaramans7398 yes that too ..

[@ETMONEY]

Hello, this is an updated research which is based on certain criteria, as discussed in the video. We have used rolling returns this time, which are a more robust indicator.

[@Aarohi_Zara]

Can you provide separte video on momentum investing on Midcap. Midcap 150 Momentum 50 index fund.

[@3universe6withme9]

No discussions on nifty200 momentum 30, nifty midcap150 - quality & momentum 50 index.

[@ETMONEY]

Hello, these indices were dropped either because there wasn't sufficient data available for their analysis or they aren't readily investable, i.e., either no fund is available or the ETF available has insufficient volumes. So, they don't appear in our analysis.

[@Dushyantgiri]

As per freefincal in long term momentum approaches index50 or index next 50, ( data from US markets) if want to be adventurous a bit then pick any momentum ..

[@tusharjha5787]

Any particular reason why Nifty 200 momentum 30 was not included. Also can you please share any insights you may have on why are there more ETFs and not many index funds for Nifty 100 Low vol 30 index. What could be the reason for AMCs doing that

[@ETMONEY]

Hello, I understand that you are interested in the Nifty200 Momentum 30 index. Unfortunately, there wasn't sufficient data available for the Nifty200 Momentum 30 index, so we had to remove it from the analysis. We have discussed the criteria for shortlisting the seven factor indices towards the start of the video. Hope this helps.

[@Fincharger]

Continue your SIP and Keep Adding more on every dip, that's the easiest way to get more out of Index funds :)

[@deepeshshah8260]

In another video featuring Mr. Shankar Nath, the Nifty50 Equal weight, was claimed to beat the benchmark. In this video the same index is projected as the worst index. I don't know how many more contradicting videos would be there on ET Money's channel.

[@deepeshshah8260]

People are watching all of your videos. Such contradictions will confuse those who are planning to start their investments. Please create focused playlists instead of posting ad-hoc videos.

[@deepeshshah8260]

And for God sake please tell us one final time whether we should consider market cap index or equal weight index.

[@rsv1503]

Shankar Nath in the video said they can't come to conclusion between Nifty 50 & Nifty 50 equal weight . It is based on momentum and value he said.

[@rsv1503]

@@deepeshshah8260 Yes.

[@ETMONEY]

Hello, thanks for being a regular viewer. No investment analysis can be permanent. It changes with time as data or context changes. That's why we do updated coverages. This analysis is based on more robust methodology and data points.

[@gokulg8475]

I cannot find the Kotak Nifty Alpha 50 fund in your ET Money app. Please check

[@ETMONEY]

Hello, please let me share your concern with the product team. By the time we fix the issue, please feel free to consider other funds based on the Alpha 50 index.

[@rahulmankani1271]

Same here. I can’t find Kotak on there app either.

[@SujjuBabu]

I find the Nifty MidSmallCap 400 Momentum quality 100 index the OG index and the new prodigal kid on the block.

[@anirudhalewoor6834]

Hello Team make comprehensive video on multi factor based investing

[@ETMONEY]

Hello, thanks for your suggestion. Will share it with the content team.

[@raghav4608]

6:59 the low volatility index beating it's benchmark on standard deviation is a no brainer, that's the purpose of the fund 😂

[@ETMONEY]

Hello, you are right, yet, from an analytical standpoint, it's always worthwhile to check if the performance is indeed what it's meant to be.

[@parthasarathyvenkatadri]

What about nifty 200 momentum 30 ... And nifty 500 value 50

[@sudeeptapanda4876]

I have invested in both the funds. UTI Fund house. So far I am happy with the returns

[@ETMONEY]

Hello, I understand that you would liked us to analyse these two indices as well. However, there wasn't sufficient data available for their analysis, so we had to drop them.

[@jsajeev3046]

I think you missed one of the most promising indices as mentioned by others - Nifty200 Momentum 30 which has Index funds and also ETFs...

[@ETMONEY]

Hello, I understand that you are interested in the Nifty200 Momentum 30 index. Unfortunately, there wasn't sufficient data available for the Nifty200 Momentum 30 index, so we had to remove it from the analysis. We have discussed the criteria for shortlisting the seven factor indices towards the start of the video. Hope this helps.

[@saitejeshwarreddy3598]

U missed Nippon India Nifty Alpha low Volatility 30 index...

[@ashaydoshi5582]

What will happen to research analysts? These products will disrupt flows into largecap mutual fund schemes!

[@sonumeena6878]

Nifty bank index

[@thedefender2191]

What about movalue etf and alpha etf

[@ETMONEY]

Hello, we have considered only those indices that have fulfilled the criteria discussed towards the start of the video.

[@soyalsayyad1079]

Nice ppt editing..how can i record this type of video..anyone can help me plz?

[@abhishekchatterG]

i dont think this can be done in a live teaching session. this is more like advance video editing

[@skotte9]

pl make this simple

[@deeprajmitra8415]

Motilal Oswal enhanced value index fund??????

[@ETMONEY]

Hello, we have covered only those indices that cleared our criteria, which are discussed towards the start of the video.

[@saulgoodman980]

Did you use TRI or PRI?

[@ETMONEY]

Hello, we always use TRI data unless otherwise stated.

[@dr.riteshchhabra3611]

It isn't smart without momentum indexes.. Incomplete analysis is not expected from ET money !

[@ETMONEY]

Hello, I understand that you are interested in the analysis of momentum indices. However, none of the momentum indices were able to clear our selection criteria. Either there wasn't sufficient data available for their analysis or they were not readily investable. So, we had to drop them from our analysis.

[@jasbirsinghkhalsa6917]

Enhanced Value index or value 50 nifty 500... if you've made this video on Feb 24, then there are many. It would be requested to compile every index and make a single content. Length doesn't matter. Please don't go by analytics if it has to include types of indexes whose funds have been issued. We are actual viewers and listeners and take decisions accordingly. So make some content for us. Thanks 😊

[@ETMONEY]

Hello, thanks for your suggestion and for being a keen viewer of our content. Will surely share your feedback with the content team.

[@amolgupta8894]

Factor investing may not be passive investing. Please correct your content.

[@pramoddubeyallahbad]

tujhe zada pata hai?

[@thefacts93]

Achchaaaaaa.

[@rOcky3211]

@@thefacts93 You're correct, and I appreciate the clarification. Factor investing is indeed a form of active investing rather than passive investing. Unlike traditional passive strategies that aim to replicate the performance of a broad market index, factor investing involves selecting stocks based on specific factors or characteristics believed to contribute to higher returns. This active approach entails ongoing management and adjustments to the portfolio based on the chosen factors, making it distinct from the hands-off nature of true passive investing. Thank you for pointing that out.

[@amolgupta8894]

@@pramoddubeyallahbad Jee haan

[@pramoddubeyallahbad]

@@rOcky3211 I don't think so. Factor investing can be considered a form of passive investing, but it also has active elements. Passive investing typically involves investing in broad market indexes or ETFs that aim to replicate the performance of an index, such as the S&P 500, without trying to outperform the market. In contrast, factor investing involves targeting specific factors, such as value, size, momentum, quality, or low volatility, with the aim of achieving excess returns compared to the broader market. Factor investing can be passive in the sense that investors are not actively picking individual stocks but rather selecting investments based on certain predetermined factors. However, it also involves active decisions in terms of selecting which factors to focus on and periodically rebalancing the portfolio to maintain exposure to those factors. So, while factor investing shares some characteristics with passive investing, it also incorporates active strategies to capture specific risk premia associated with different factors.

[@vinbharvad19867]

Sir muje hindi aur gujrati janta hu, please upload video hindi and gujrati, angreji nahi aati 😮

[@ETMONEY]

Hello, we understand that Hindi is your preferred language. We also have a Hindi channel, on which you can find the translated versions of the videos on this channel, along with lots of other insightful content. Please visit www.youtube.com/@etmoneyhindi.