The Factor Report

Market Wrap

For the week ended October 10th, 2025, stocks were lower everywhere. Bonds were higher for the week as the iShares Core US Aggregate Bond ETF (AGG) rose 0.25%; the 10-year US treasury yield fell to 4.05%, according to Yahoo Finance. Asset price drivers of the week:

• Monday was a good start to the week again as investors ignored the government shutdown. Focus was instead on the potential of AI as Advanced Micro Devices jumped more than 20% on a deal with OpenAI (maker of Chat GPT).
• Tuesday saw a reversal of Monday's activity as Technology stocks pulled indices down after Oracle announced smaller than expected profit margins.
• Wednesday brought a resumption of stock gains as investors anticipated (and got) the release of the Federal Reserve's most recent meeting minutes, which seemed to point toward more rate cuts later this year.
• On Thursday, stocks again took a breather after hitting fresh highs. Earnings season is upon us and the shutdown appears to have no end in sight, both of which are sources of uncertainty.
• Friday started out on a positive note, but it didn't last because President Trump announced early that massive tariffs are coming on China and he canceled his meeting with President Xi. This sent indices spiraling in fear of another round of trade wars amidst concerns about the economy and inflation, not to mention massive government furloughs as part of the shutdown.
• Next week would be filled with important economic data, including some key inflation indicators, but we won't get it due to the ongoing shutdown.

Performance Summary

As shown in the chart, Emerging Markets was again by far the week's big winner and the US lagged. Within the US, all three key indices (the S&P 500, the Nasdaq, and the Dow Jones Industrial Average) dropped about the same amount. This paved the way for some differentiation and factors had their strongest week of the year - all of them outperformed the global All Country World Index (ACWI).

In The News

A great "different voice" on the AI trade.

https://www.marketwatch.com/story/this-ai-skeptic-got-feedback-from-the-industry-and-now-hes-even-more-pessimistic-49284b40?mod=home_lead

Why has gold been on such a tear? A number of talking heads weigh in.

https://www.thinkadvisor.com/2025/10/07/why-golds-surging-and-where-its-going/?kw=Why%20Gold%27s%20Surging%20and%20Where%20It%27s%20Going&utm_source=email&utm_medium=enl&utm_campaign=earlywire&utm_content=20251008&utm_term=tadv&oly_enc_id=6911H2583589A7Z&user_id=3d158419d93f4751d4b3b79dd78d9abf446b89b61e92e7567cb4126b86cb53c5

13 New Tax Numbers to Know for 2026.

https://www.thinkadvisor.com/2025/10/10/13-new-tax-numbers-to-know-for-2026/?kw=13%20New%20Tax%20Numbers%20to%20Know%20for%202026&utm_source=email&utm_medium=enl&utm_campaign=newsroomupdate&utm_content=20251010&utm_term=ta&oly_enc_id=6911H2583589A7Z&user_id=3d158419d93f4751d4b3b79dd78d9abf446b89b61e92e7567cb4126b86cb53c5

Disclosures

Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy will be profitable or equal the corresponding indicated performance level(s). Moreover, you should not assume that any of the above content serves as the receipt of, or as a substitute for, personalized investment advice from Metric Financial.

All data and performance information sourced from Morningstar and MarketWatch, unless otherwise indicated.

USA is the MSCI USA index, Non-US Developed is the MSCI EAFE index, Emerging Markets is the MSCI Emerging Markets index, and All Country World is the MSCI ACWI index. One cannot invest in an index. Because the factor indexes have varying inception dates, some of the returns provided are back-tested and do not represent actual performance. Inception dates are as follows:

Momentum = MSCI ACWI Momentum NR USD Index (Inception: 11/30/95)

Value = MSCI ACWI Enhanced Value NR USD Index (Inception: 5/29/15)

Quality = MSCI ACWI Quality NR USD Index (Inception: 5/29/92)

Low Volatility = MSCI ACWI Minimum Volatility (USD) NR USD Index (Inception: 5/28/93)

Size = MSCI ACWI Risk Weighted NR USD Index (Inception: 4/6/11)

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All written content is for information purposes only. Opinions expressed herein are solely those of Metric, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to another parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation.