In this episode of Solin Speaks, Dan Solin explores the strategic choice of using small and value tilts in investment portfolios. Joined by co-host David, Dan breaks down the potential benefits and challenges of tilting toward small-cap and value stocks, drawing on research from Fama and French that suggests higher long-term returns.
Dan emphasizes the importance of managing client expectations and choosing the right clients for these strategies. Small and value tilts require patience and a long-term perspective, making them better suited for clients with extended investment horizons and higher risk tolerance. He also highlights the need for clear communication to prepare clients for periods of underperformance compared to market-cap-weighted portfolios.
The episode wraps up with practical tips for advisors, including starting with modest tilts, regularly reviewing performance, and being ready to adjust if clients feel uncomfortable. Ultimately, Dan reminds listeners that while tilts can enhance returns, a simple, diversified, market-cap-weighted portfolio remains an excellent option for many investors.
Dan Solin
📧dansolin@ebadvisormarketing.com
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