Jacobs Levy Equity Management

Jacobs Levy Equity Management focuses exclusively on managing U.S. equity portfolios for institutional clients. Strategies offered by the firm include long equity, defensive equity, 130-30, and market neutral long-short portfolios. Building on the pioneering research of founders Bruce Jacobs and Ken Levy, the firm has developed a unique, multidimensional, dynamic approach to investing that combines human insight and intuition, finance and behavioral theory, leading-edge quantitative and statistical methods, and over 25 years of ongoing proprietary research. Jacobs Levy manages assets for a prestigious global roster of corporate defined benefit and defined contribution plans, public retirement systems, sub-advised funds, and endowments/foundations, including many of Pensions & Investments’ “Top 200 Pension Funds/Sponsors.”
“Ten Investment Insights that Matter,” by Bruce I. Jacobs and Kenneth N. Levy, Journal of Portfolio Management, Special 40th Anniversary Issue, September 2014. article This article discusses the key insights that inform our investment process, developed over 30 years of research and portfolio management. These insights and the resulting rewards to active management stem from the realization that the market is a complex system. Paradoxically, if the market were simpler, and investing easier, the rewards would be smaller, because many would have the skills to succeed. It is the market’s very complexity that offers the opportunity to outperform—to those investors willing and able to grapple with that complexity. “Investing in a Multidimensional Market,” by Bruce I. Jacobs and Kenneth N. Levy, Financial Analysts Journal, November/December 2014. article Many years ago, Bruce Jacobs and Ken Levy demonstrated that there is much greater dimensionality to the stock market than is suggested by the one-factor capital asset pricing model. Investors today continue to underestimate the market’s dimensionality through their recent embrace of “smart beta” strategies. Such strategies assume a market in which a few chosen factors produce persistent returns. In reality, there are numerous factors that produce returns, which vary over time. Those returns can best be captured by a multidimensional approach that emphasizes diversification across many proprietary factors and continuous adjustment of exposures to those factors. “Smart Beta versus Smart Alpha,” by Bruce I. Jacobs and Kenneth N. Levy, Journal of Portfolio Management, Summer 2014. article Smart beta strategies aim to outperform the capitalization-weighted market through relatively simple alternative weighting methods that emphasize a handful of factors such as size, value, momentum, or low volatility. Though similar in some respects to passive index investing, smart beta strategies are the product of active choices and should be compared with proprietary active multifactor investment strategies (“smart alpha”). Smart beta strategies exploit fewer return opportunities, tend to be more static, and have less control of risk exposures. Furthermore, because of their reliance on a small number of factors, smart beta strategies can run into liquidity and overcrowding problems that can adversely impact their performance. Smart alpha may be the smarter choice.
Highlights from the Second Annual Jacobs Levy Center Conference		Highlights from the First Annual Jacobs Levy Center Conference and Presentation of the Wharton-Jacobs Levy Prize to Harry M. Markowitz
Pictured (l-r) Bruce Jacobs, Professor Jeremy Siegel, Ken Levy		Pictured (l-r) Bruce Jacobs, Nobel Laureate Harry Markowitz, Ken Levy
Jacobs Levy Equity Management Center for Quantitative Financial Research Conference on Quantitative Finance April 25, 2014 The Wharton School		Jacobs Levy Equity Management Center for Quantitative Financial Research Forum on Quantitative Finance October 23, 2013 New York, NY