Enhanced Indexing

Filed Under » , , ,
Dictionary Says

Definition of 'Enhanced Indexing'

An investment philosophy that attempts to amplify the returns of an underlying portfolio or index fund while also minimizing the effects of tracking error. This type of investing is considered a hybrid between active and passive management and is used to describe any strategy that is used in conjunction with index funds for the purpose of outperforming a specific benchmark.
Investopedia Says

Investopedia explains 'Enhanced Indexing'

For example, an investor can short sell poor performing stocks from an index and then use the funds to purchase shares of companies they expect will have high returns. Investors can substantially outperform a benchmark over long time horizons by consistently eliminating their exposure to poor performing stocks and by using the proceeds to invest in other securities.

Articles Of Interest

  1.

    Enhanced Index Funds: Can They Deliver Low-Risk Returns?

    These funds may look appealing. Find out whether they can really live up to all of their promises.

  2. Enhance Your Portfolio With Active Equity

    This strategy provides the potential for larger returns while using less capital.

  3. The Hidden Fees In 401(k)s

    Learn about the conspicuously disclosed fees that lurk within your 401(k) investments.

  4. How Interest Rates Affect The Housing Market

    Understand how rate changes can affect home prices, and learn how you can keep up.

  5. Break Into Forex In 12 Steps

    Learn how to get started in forex trading.

  6. Breaking Down The TSP Investment Funds

    For investors seeking growth, income AND capital preservation, the Thrift Savings Plan offered by the U.S. government is a great option to consider. In this article, we examine the five core ...

  7. Choose A Fund With A Winning Manager

    We break down the key components of analyzing a fund manager's performance so you can find a winner.

  8. George Soros: The Philosophy Of An Elite Investor

    George Soros spent decades as one of the world's elite investors, and even he didn't always come out on top. But when he did, it was spectacular.

  9. Analyzing The Best Retirement Plans And Investment Options

    Understanding the various retirement investments - from annuities to 401(k)s and everything in between - is crucial to reaching your retirement goals. Here, we examined many of the popular investments ...

  10. Quants: The Rocket Scientists Of Wall Street

    Blend math, finance and computer skills to command a high - and well deserved - salary.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Yield Elbow

    The point on the yield curve indicating the year in which the economy's highest interest rates occur. The yield elbow is the peak of the yield curve, signifying where the highest interest rates occurred.

  2. Xenocurrency

    A currency that trades in markets outside of its domestic borders.

  3. Wanton Disregard

    A standard of severe negligence. Wanton disregard is a very serious accusation that indicates that a person behaved extremely recklessly.

  4. Ultra ETF

    A class of exchange-traded funds (ETF) that employs leverage in an effort to achieve double the return of a set benchmark.

  5. Toehold Purchase

    A purchase of less than 5% of a target company's outstanding stockmade by an acquiring company. A toehold purchase of just under 5%, while not a significant stake in a firm, allows the shareholders a "toe-holds" grip on the company and its decision making.

  6. Samurai Bond

    A yen-denominated bond issued in Tokyo by a non-Japanese company and subject to Japanese regulations.
Trading Center
http://sp.fastclick.net/ad/tr/10858-64082-15546-0?mpt=406d91a658bbe832c92775e96bc1fedc