Smart beta provides 30% annual return, says Copia

Copia Capital Management has reported annualised return of 30.6% for its Dorsey Wright Smart Beta portfolio over the past 12 months, which it said has helped underpin the overall performance of its proposition to the UK market, particularly financial advisers.

The Copia Dorsey Write Smart Beta portfolio uses analysis of factors such as supply and demand to make timing decisions and invest in ETFs identified as most likely to outperform. The portfolio tends to use First Trust AlphaDEX ETFs, although other trackers may be used where First Trust ones are not available.

Additionally, the Copia First Trust Smart Beta portfolio made return of 28.1% over the same period, the provider reported. This portfolio uses quantitatively driven country rotation and risk rotation to determine allocation to First Trust smart beta ETFs.

Hoshang Daroga  Quantitative Investment manager at Copia said: “The strong performance of these new portfolios can be mainly attributed to outperformance from the underlying Smart Beta ETFs as well as the tactical asset allocation performed using the Copia Quant Model and the Dorsey Wright investment strategy. It is interesting to note that despite outperforming many of the ETF portfolios available in the market, inflows into smart beta led strategies still remain comparatively low”

Derek Fulton CEO at First Trust Global Portfolios added that “academic research continues to demonstrate the benefits of using smart beta in beating indices, but in order for advisers and investors to capitalise on these potential returns, education is needed to help advisers further understand this investment strategy which, whilst widely taken up in the US, remains to some extent hidden under a bushel here in the UK”.

Copia Capital Management is a business division of Novia Financial, a UK platform provider with some £5bn (€5.69bn) under administration.


Jonathan Boyd
Editorial Director of Open Door Media Publishing Ltd, and Editor of InvestmentEurope. Jonathan has over two decades of media experience in Japan, Australia, Canada and the UK. Over the past 17 years he has been based in London writing about funds and investments. From editing the newsletter of the Swedish Chamber of Commerce in Japan in the 1990s he now focuses on Nordic markets for InvestmentEurope. Jonathan was awarded Editor of the Year at the Professional Publishers Association (PPA) Independent Publisher Awards 2017. Shortlisted for the same in 2016, he was also shortlisted in 2017 and 2015 for the broader PPA Awards category Editor of the Year (Business Media).

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