What is the primary focus of Factor Investing?

"Identifying stocks with high dividend yields" "Investing in companies with strong momentum" "Selecting investments based on specific characteristics that drive returns" "Analyzing macroeconomic trends to predict market movements"

Which of the following is NOT a common factor considered in Factor Investing?

"Company size" "Stock volatility" "Brand reputation" "Dividend yield"

How does Factor Investing combine aspects of both active and passive investing?

"It relies solely on index funds like passive investing, but actively manages the chosen index" "It involves selecting securities based on factors like active investing, but with less frequent trading" "It mirrors the portfolio of a chosen actively managed fund, but with lower fees" "It uses algorithms to automatically replicate the trades of successful active investors"

What is a key advantage of Factor Investing compared to Active Investing?

"It guarantees higher returns with lower risk" "It eliminates the need for any market analysis" "It relies on evidence-based metrics rather than speculation" "It is entirely automated and requires no investor input"

Which of the following is a potential benefit of building a portfolio using different factors?

"Maximizing short-term profits" "Ensuring all investments are in large-cap companies" "Reducing the overall volatility of the portfolio" "Guaranteeing a fixed rate of return"