Little Things Mean A Lot

My colleagues have produced a paper on something we call, perhaps pretentiously though we can't come up with a better word for it, “craftsmanship” — what we believe to be a necessary part in creating successful factor portfolios. What factors (value, momentum, small, quality, others?) you believe in, or dismiss, gets much of the attention. That's understandable and appropriate. But we think there are many smaller decisions that each can matter some, and collectively can matter a lot. I won't repeat the analysis and examples from the paper here (please read it!). But, I will use this essay as an excuse to discuss, in brief, two separate topics that I'd been planning to write about for a while (I still might expound upon these more in the future).