Factor Rotations Explained
What's going on? All you need to know.
What are these factor rotations everybody has been talking about?
Quite conveniently, we already know more than enough from two of our previous writeups to understand what’s going on:
By the way, our previous writeup Pitching and Analyzing Stocks Like a World-Class Analyst is a great example of how to turn your modeling, understanding of key debates/drivers of the stock, sentiment, risk/reward thinking, data analysis into one coherent actionable pitch/recommendation. Save it and keep it handy. More on that to come soon!
In this writeup, we will intuitively explain factor rotations based on what we have already learned and address some of the arguments being made, such as ‘oh, if you are market-neutral you should be fine’.