Why These Factor ETFs Beat the Market
đ CRAZY GOOD INVESTING
I hope youâve seen our disclaimer. Not sure?
BY THE POWER OF GRAYSKULL, I DO DISCLAIM: This content is for informational and educational purposes only and does not constitute financial, investment, or trading advice. Iâm not a financial advisor, and nothing here should be interpreted as a recommendation to buy, sell, or hold any security. Do your own research. Talk to people you trust. And make decisions based on your own goals and risk tolerance.
Ok, soâŚ
Most people invest like theyâre filling out a bingo card.
Buy some tech. Maybe a dividend ETF. Toss in a growth fund because itâs been hot.
âWhat about PLTR - ITâS SO HOT RIGHT NOW.â
Cross your fingers.
YMMV.
But what if you could use decades of data, Nobel-winning research, and a little bit of psychological self-awareness⌠to tilt your portfolio in a direction thatâs smarter, not just trendier?
Thatâs the promise of factor tilt ETFs â and over the past year, a handful of them have not only beaten the S&P 500, theyâve crushed it.
Letâs break down how â and why it might matter to you.
đ The 15 Best-Performing Factor Tilt ETFs (1-Year)
We screened U.S.-listed, non-leveraged, non-inverse, and non-thematic ETFs for those tilted toward real academic factors: momentum, value, size, quality, low volatility, and multifactor blends.
Here are the top performers from mid-2024 to July 25, 2025:
đ§ HEAD CHECK: What Makes These ETFs Smarter?
Unlike basic index funds, factor ETFs apply rules to tilt their holdings toward stocks with traits that research has shown matter. Things like:
Momentum: Winners that tend to keep winning
Quality: Strong balance sheets, steady earnings
Value: Undervalued relative to fundamentals
Size: Smaller companies with higher growth potential
Low Volatility: Stocks that stay steady under pressure
This isnât gambling. Itâs decades of academic research in action â and it works over time.
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đ Why They Beat SPY This Year
1. Momentum & Growth Overweight
Funds like SPMO and MTUM rode the tech rally and concentrated leadership. They leaned in while SPY diversified.
2. Systematic Quality Filters
PWRD and GFLW focused on companies with real earnings, strong cash flows, and durable business models. When the market started rewarding fundamentals again, these funds popped.
3. Focused Growth Bets
LSGR, PJFG, and others held fewer names â but bet bigger on secular winners like AI, semiconductors, and cloud stocks.
4. Dynamic Rules-Based Updating
Most of these ETFs rebalance quarterly or monthly, adjusting faster than SPY, which sticks to cap-weighted inertia.
â¤ď¸ HEART CHECK: Why Itâs Still Hard to Stick With
Even when factor funds work, theyâre hard to hold.
They underperform sometimes. They feel niche. Your uncle will ask why you donât just buy SPY or VOO or VTI.
But hereâs the deal:
*Outperformance doesnât come from doing what everyone else does.*It comes from using better rules â and having the patience to let them work.
Factor ETFs are an emotionally honest way to invest:
They admit the marketâs messy.
They own their bias.
And they stay disciplined when most people chase.
Thatâs⌠kind of a Crazy Good way to invest.
đ§ GUT CHECK: Is This Right for You?
Ask yourself:
Do I want a portfolio with deeper conviction?
Am I willing to look âwrongâ for a while to be right over time?
Can I follow a smart process â even when it doesnât feel exciting?
If the answer is yes, adding a few well-chosen factor ETFs might give your portfolio more edge and less fluff.
đ§ Start Simple: 2â4 ETFs, One Strategy
A sample combo might look like:
SPMO for momentum
VTV or TILT for value/size blend
CGDV for quality dividends
USMV for stability
Think of it like seasoning â not a full meal replacement.Tilt what you can stomach. Hold what you understand.
Final Thought
Investing isnât just about what performs.Itâs about what aligns with your beliefs, your strategy, and your nerves.
Factor ETFs â when used right â can give you an edge thatâs grounded in evidence, not hype.
And thatâs what Crazy Good Investing is all about:Simple ideas. Smart execution. Real emotional clarity.
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