Video Short: Alternative to a Manic AI Market: RAFI vs Equal-Weight

Описание: Watch Research Affiliates’ Matt Lundberg provide a brief overview of our latest research.

He describes that soaring valuations driven by AI mania, major tech stocks, including the Magnificent Seven, are at historically high concentration levels in cap-weighted indices. To mitigate concentration risk, investors need a broad-market strategy superior to naïve equal-weight indices.

Read the full article on our website: https://www.researchaffiliates.com/pu...

Key Findings From Our Research:

• As a result of soaring evaluations, tech leviathans now account for historically extreme levels of concentration in cap-weighted indices.
• For investment portfolios, unconscious concentration ties risk exposure to a few companies with prices that may be distorted by AI mania.
• Concentration risk highlights the vulnerability of cap-weighted indices to short-term volatility and irrationality.
• Equal-weight indices offer broad-market exposure to mitigate concentration but have significant limitations.
• The RAFI Fundamental Index strategy provides a superior alternative for broad-market exposure that has theoretical and practical advantages.

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