Faber: Why Market-Cap Weighting Falls Short
Cambria founder Mebane Faber talks to Morningstar’s Sam Lee about his fund’s global value strategies and what he is buying in his personal portfolio.
A version of this article was published in the June 2014 issue of Morningstar ETFInvestor. Download a complimentary copy here.
Mebane Faber should be no stranger to readers. He entered the exchange-traded fund business by partnering with AdvisorShares to launch AdvisorShares Cambria Global Tactical (GTAA) (AdvisorShares recently announced that it's proposing to GTAA's board of directors replacing Cambria with Morgan Creek Asset Management). Last year, Faber's firm Cambria Investments struck out on its own to launch Cambria Shareholder Yield (SYLD) and Cambria Foreign Shareholder Yield (FYLD). Both funds invest in stocks with the highest total payout yields, defined as the sum of aggregate dividends, net share repurchases, and net debt reduction over total market capitalization. His firm followed up this year with Cambria Global Value (GVAL), which focuses on value stocks in the most beaten-down, unloved countries. I think of it as a value strategy on steroids.
Samuel Lee does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.