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  • Irrational Capital

JPM Releases Fourth Human Capital Factor Research Note

We are thrilled that JP Morgan has released its fourth research note entitled “Human Capital Factor: What Drives Employees, Intrinsic or Extrinsic Factors?” continuing its independent validation of the unique alpha and portfolio outperformance of the Human Capital Factor (HCF). This compelling publication from Institutional Investor’s top quantitative research firm takes a deep dive into the 7 Dimensions which comprise the Human Capital Factor.

We are pleased to share the following highlights:

· “Long term the Human Capital Factor delivers 4.0% annual returns in excess of the benchmark and 3.8% in excess of the low Human Capital Factor stock portfolio.”

· “The implication is that since human capital is not accounted for on balance sheets, there [is] exists the opportunity to gain enhanced returns by correctly identifying those companies which have superior human capital.”

· “Simply put, employees respond to more than pay, rewards and compensation to be highly motivated and productive in the workplace. Being able to capture and measure both intrinsic and extrinsic motivational criteria does not only help employers but may also lead to better stock price returns.”

The results are illuminating, and we invite you to request a copy of the full report here.

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