The Epsilon Institute Case Scenario

John Fraser’s performance is the first that Lazare and Warrack review. Fraser’s fund is constructed with a discretionary approach using the four Fama–French factors.

Does discretionary approach uses factor model? I remember only systematic approach uses factor model to identify risk factors that have predict power for future return, while discretionary approach uses manager judgment and insights on company’s characteristics.

Discretionary approach mean the manager uses discretion, which is another word for judgment.

Does it use factors? What does this exhibit from the text tell you?