Passive index funds trying to minimise tracking error is coming at a cost to returns, according to Dimensional Fund Advisors.
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Passive index funds trying to minimise tracking error is coming at a cost to returns, according to Dimensional Fund Advisors.
Index providers are in the business of selling indices, not investment strategies – but trillions of dollars are invested in funds tracking them.
The Institutional Client Designed Indexes allows institutional asset owners to modify an index’s methodology to address changes in investment strategies.
But overall assets in Hong Kong’s mutual fund industry were down 13%, according to SFC’s annual report.
Despite the difficult political and economic environment in Hong Kong, the firm hopes to eventually sell the newly SFC-authorised products.
But Natixis GAM, which conducted the study, believes they may be over-estimating the passive products.
Part of the Mark Allen Group.