%0 Journal Article %A Mehdi Alighanbari %A Chin Ping Chia %T Multifactor Indexes Made Simple: A Review of Static and Dynamic Approaches %D 2016 %R 10.3905/jii.2016.7.2.087 %J The Journal of Index Investing %P 87-99 %V 7 %N 2 %X Multifactor index fund allocations are increasingly becoming the preferred approach to factor investing. This article examines the return–risk characteristics of nine static and dynamic weighting strategies over a 36-year period. The results highlight that a simple strategy that equal weights multiple factor indexes has historically proved more effective than many of the more complex approaches—pointing to its potential as a way to combine factors, especially in the absence of active investment views and skills. However, a dynamic factor-weighting strategy based on fundamental signals also has merit if the investor believes she has the insight or skills required.TOPICS: Mutual funds/passive investing/indexing, analysis of individual factors/risk premia %U https://jii.pm-research.com/content/iijindinv/7/2/87.full.pdf