Assessing the impact of style factor investment on risk and performance investment funds and comparing them with the performance of Index Tracker funds related to similar asset classes.

Altough the concept of smart beta and factor investing is relatively new in the financial world, the interest of actors in the financial markets is steadily growing. This paper takes a look at the origins of smart beta and at development of smart beta as a financial strategy. Moreover the paper will take a look at the practical implementation, and finally construct two factor portfolios to assess their performances compared to a benchmark index.