Chapters in Portfolio & Risk Management
Chapter 4 of 6 · 5 min read
Attribution and factor exposure
Find out why you made or lost money: sector bets, stock picks or style tilts.
Attribution
Attribution splits portfolio return versus a benchmark into allocation (being in the right sectors) and selection (picking the right stocks within them). It tells you whether skill, or just a sector tailwind, drove returns.
Factor exposure
Factors are persistent drivers of returns: value, momentum, quality, size and low volatility. Your holdings may lean on one without you realising, such as a high-momentum, small-cap tilt.
Knowing the tilt lets you decide whether it is intentional and whether it matches your risk tolerance.
Key takeaways
- Separate sector luck from stock-picking skill.
- Factor tilts explain behaviour in different regimes.
- Hidden tilts are hidden risks.
Put it into practice
Open the live page on Market Intelligence and see this concept on real data.
Keep learning
- Rebalancing and the portfolio optimizer · Portfolio & Risk Management
Education only, not investment advice. Updated 2026-10-09.