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Just Published

Active Dreams, RAFI Delivers: Active vs. RAFI Performance in Broadening and Narrowing Markets

Active Dreams, RAFI Delivers: Active vs. RAFI Performance in Broadening and Narrowing Markets

By Ari Polychronopoulos, Grant Kasser, Thomas Verghese, CFA
October 2025

Active management underperforms in broad and narrow markets alike and is no cure for concentration, but fundamental indexing and smart beta strategies may provide an alternative. 

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Featured Insights

RACWI: Reinventing Cap-Weighted Indexing

RACWI: Reinventing Cap-Weighted Indexing

By Rob Arnott, Lillian Wu
September 2025
Traditional cap-weighted indexes have structural flaws that impose a costly drag on investor performance. By rethinking stock selection, the RACWI US Index offers a smarter approach that avoids deficiencies and adds value.
False Choices, Real Costs: Structural Flaws in the Growth–Value Duality

False Choices, Real Costs: Structural Flaws in the Growth–Value Duality

By Que Nguyen, Omid Shakernia
July 2025
To overcome the costly false duality between growth and value, we propose a model that defines growth as fast growing regardless of valuation ratios, and value as cheap regardless of growth rates—treating the two as distinct, not opposing, characteristics.
Must Value Be Anti-Growth?

Must Value Be Anti-Growth?

By Mario Albuquerque, Noah Beck, Que Nguyen
July 2025
Many value investors fall into the trap of being anti-growth, but fundamentals can be used to identify both valuation and growth characteristics. Being growth agnostic can unlock outperformance.
Expand Your Mind and Your Commodity Universe

Expand Your Mind and Your Commodity Universe

By Ben Chen, Jim Masturzo
July 2025
Broadening the commodity investment universe in long-only and long-short factor portfolios, subject to capacity and tradability thresholds, can improve risk-adjusted returns through higher roll yields, liquidity premia, and added diversification.
How Can “Smart Beta” Go Horribly Right?

How Can “Smart Beta” Go Horribly Right?

By Noah Beck, Xi Liu, Que Nguyen
June 2025
Smart beta strategies went horribly wrong over the last eight years. But now they may be poised to go horribly right.
Passive Aggressive: The Increasing Risks of Passive Dominance

Passive Aggressive: The Increasing Risks of Passive Dominance

By Chris Brightman, Campbell Harvey, Forrest Henslee
June 2025
While passive indexing increases correlations, distorts prices, and heightens systemic risk, it also creates opportunity for active investors to profit from systematic rebalancing.
Stimulus Does Not Stimulate

Stimulus Does Not Stimulate

By Rob Arnott, Alex Pickard
May 2025
Increased government spending and debt issuance, rather than encouraging economic growth, may actually stifle it.
Walking the Tightrope: Trend Following’s Tricky Tradeoffs

Walking the Tightrope: Trend Following’s Tricky Tradeoffs

By Jim Masturzo
May 2025
The positively skewed returns of trend-following strategies offer tail protection, but increased skewness comes with a lower Sharpe ratio. Managers need to understand the tradeoff and the implications for portfolio construction.
Gold $5,000?

Gold $5,000?

By Campbell Harvey
April 2025
Driven by financialization, de-dollarization, tariffs, and economic uncertainty, the price of gold is at or near all-time highs. Can it go even higher?
Why Tariffs Won’t Solve Our Trade Problem

Why Tariffs Won’t Solve Our Trade Problem

By Chris Brightman
April 2025
The U.S. trade deficit isn’t caused by unfair trade, it’s rooted in low savings, high consumption, and poor investment choices. Tariffs won’t fix it, but smarter fiscal policy, regulatory reform, and increased domestic production just might.
Small Caps, Big Opportunities: Investing Beyond Large-Cap Stocks

Small Caps, Big Opportunities: Investing Beyond Large-Cap Stocks

By Mario Albuquerque, Xi Liu, Que Nguyen
April 2025
The historically wide valuation discount between small- and large-cap stocks provides a substantial opportunity, but investors remain wary. Research shows that a smarter value approach by applying quality and momentum screens can minimize risks and enhance returns.
The AI Boom vs. the Dot-Com Bubble: Have We Seen This Movie Before?

The AI Boom vs. the Dot-Com Bubble: Have We Seen This Movie Before?

By Rob Arnott, Trent Commins, Xi Liu
March 2025
The narrative-driven AI boom of Nvidia and the Magnificent Seven echoes that of the dot-com bubble exemplified by Cisco and the Four Horsemen. The Research Affiliates Fundamental Index (RAFI) can help investors balance the risks and opportunities.

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In The News

Bloomberg
Que Nguyen Discusses Market Valuations and Emerging Opportunities
October 2025
MarketWatch
Research Affiliates on the Shifting Balance Between Active and Passive
October 2025
Bloomberg
Rob Arnott on Science, Curiosity, and Shaping Investing Innovation
October 2025
Business Insider
Rob Arnott on Science, Curiosity, and Shaping Investing Innovation
September 2025
Bloomberg
Rob Arnott on Rethinking Passive Investing
September 2025
MarketWatch
Rob Arnott on AI, Valuations, and Market Reckonings
September 2025
Press Release
RAFI Indices Announces Launch of the Research Affiliates Cap-Weighted US ETF (RAUS)
September 2025
Forbes
Rob Arnott on AI Bubble Risks Echoing Dot-Com Era
August 2025
Bloomberg
Que Nguyen on Palantir, AI Craze, and Market Expectations
August 2025
Barron’s
Rob Arnott on Why CPI Understates Inflation for TIPS Investors
August 2025
The Economist
Rob Arnott on Why Fear, Not Risk, May Lead to Better Returns
August 2025
Bloomberg
Rob Arnott on Where To Find Market Bargains
July 2025
Financial Times
Rob Arnott on “Buying the Dip”
July 2025
Wall Street Journal
Rob Arnott’s Firm Says the Time Is Finally Right for ‘Smart Beta’
June 2025
Wall Street Journal
Rob Arnott’s Firm Says the Time Is Finally Right for ‘Smart Beta’
June 2025

MORE IN THE NEWS

RA Papers On SSRN

Revaluation Alpha
September 8, 2025
A Tail of Five Skews
August 25, 2025
Fundamental Growth
July 7, 2025
The Risks of Passive Investing Dominance
May 19, 2025
Does Fiscal Stimulus Stimulate?
May 07, 2025
The EV Shakeout
April 08, 2025
Fear, Not Risk, Explains Asset Pricing
February 07, 2025
Reimagining Index Funds
October 03, 2023

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