Factor beta or smart ETFs provided a range of protection for investors. This is not the same as principal protection, but holding, for example, value or low volatility exposure was extremely helpful for any investor. Style factors are regime dependent.
This can also be seen with the long-short factor performance which generally did well. However, in a volatile market factors like quality may not have the opportunity to show its value. Quick adjustments may lead to long underperforming relative to short that are expected to improve.
Overall, the regime for any factor matters and should be the focus of investor. An inflation environment with slow growth and a bear market bias will be better for some factor exposure like value. Define the regime and then think about the investment exposure.
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