The Research Department of Economics and Management of Tadbir Nikan Business, Marketing, and Finance Open In Press 2026 09 01 Empirical Analysis of the Impact of Macroeconomic Variables on the Performance of Factor Investment Strategies (Smart Beta) in the Iranian Capital Market Empirical Analysis of the Impact of Macroeconomic Variables on the Performance of Factor Investment Strategies (Smart Beta) in the Iranian Capital Market 1 14 EN Journal Article 2025 09 28 <p>In recent decades, the evolution of financial theories and the development of advanced asset pricing models have paved the way for the emergence of modern investment approaches. Among these, factor investing (smart beta) has emerged as one of the most important approaches, grounded in the identification and exploitation of systematic factors that generate excess returns in financial markets. This approach, which is rooted in the seminal studies of Fama and French (1993, 2015), has today become a core strategy in global asset management. The purpose of the present study is to examine the impact of macroeconomic variables, including economic growth rate, interest rate, and inflation rate, on the performance of five investment factors—size, quality, value, momentum, and low volatility—in the Iranian capital market over the period 2013 to 2024. To this end, the effects of macroeconomic variables on the aforementioned factors were first analyzed using a multivariate regression model. Subsequently, two types of investment portfolios were constructed: an equally weighted five-factor portfolio and an adaptive three-factor portfolio based on the performance of the top three factors in each of the economic regimes of recession, expansion, and stability, and their performances were compared. The findings indicate that macroeconomic variables have a statistically significant impact on the performance of all examined factors, except for the quality factor. Moreover, the results of portfolio performance comparison show that the adaptive three-factor portfolio outperforms the equally weighted five-factor portfolio across all economic regimes. These findings underscore the importance of considering macroeconomic conditions and adopting dynamic approaches in the design of factor-based investment strategies in the Iranian capital market.</p> https://bmfopen.com/index.php/bmfopen/article/download/382/293