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Definition of 'Yield Tilt Index Fund'
A type of mutual fund that allocates capital as a standard index, by replicating the holdings of a specified stock index, such as the Standard & Poor's 500 Index (S&P 500), except that the fund weights its holdings towards stocks that offer higher dividend yields. Stocks with higher dividend yields are given a greater portfolio weighting, making them represent more of the fund's portfolio than they otherwise would in the standard index.
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Investopedia explains 'Yield Tilt Index Fund'
The rationale behind the creation of yield tilt index funds is based on the fact that dividend payments issued to shareholders can be subject to "double taxation", meaning that they are taxed once at the corporate level and then once again at the shareholder level.
Due to this effect, some investors contend that the market must value the share prices of high-yield stocks at somewhat of a discount to other stocks, so as to provide an increased return on high-yield stocks in order to compensate for the negative tax effects. The theory is that an investor who is able to purchase a yield tilt index fund in a tax-sheltered investment account may be able to outperform the index, since they receive the supposed valuation benefit but are sheltered from taxes on the dividends they receive.
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Search results for 'Yield Tilt Index Fund'
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http://stocks.investopedia.com/stock-analysis/2009/The-Global-Titans-of-Tomorrow-DGS-EWX-BRF-HAO1030.aspx
... Investors can choose to tilt their portfolios towards ... traditional market cap size
weighted index, the SPDR ... Distribution yield is pretty much nonexistent at 0.72 ...
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http://stocks.investopedia.com/stock-analysis/moneyshow/3Emerging-MarketFundswithBigYields.aspx
... Using data for the MSCI Emerging Markets Index, I also ... cheaper than DEM, but carries
an 8.33% forward yield. Unlike DEM, this fund is yield-weighted, which may ...
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http://stocks.investopedia.com/stock-analysis/2012/Eric-Sprott-Is-Very-Bullish-On-Gold-And-Energy-PSLV-PHYS-VDE-IEZ-MATS0124.aspx
... seeing what the pros do, can yield be results. ... Bear 3X Shares (ARCA:MATS) shorts
an index related to ... investors who follow his advice and tilt their portfolios ...
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http://stocks.investopedia.com/stock-analysis/moneyshow/HowtoTradeCorporateDebtwithETFs.aspx
... to have its PowerShares Fundamental High-Yield Corporate Bond ... allocations to the
biggest debtors, the index to which ... and high credit qualities, a tilt that can ...
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