Are Enhanced Index Mutual Funds Worthy of Their Name?

This article discusses the meaning of enhanced indexing and the techniques used by managers, and provides an empirical assessment of 8 mutual funds that are classified in the S&P 500 enhanced index category. While 3 of the funds have provided return enhancement relative to the S&P 500, these...

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Bibliographic Details
Published in:The Journal of investing 1998-07, Vol.7 (2), p.6-15
Main Authors: Riepe, Mark W., Werner, Matthew D.
Format: Article
Language:English
Subjects:
Arbitrage
Futures
Growth stocks
Index funds
Indexes
Interest rates
Optimization
Put & call options
Return on investment
Securities markets
Stocks
Studies
Treasury bills
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Summary:This article discusses the meaning of enhanced indexing and the techniques used by managers, and provides an empirical assessment of 8 mutual funds that are classified in the S&P 500 enhanced index category. While 3 of the funds have provided return enhancement relative to the S&P 500, these higher returns cannot be distinguished from those that might be expected to have occurred purely from chance. Of the 3 funds, 2 have exhibited characteristics reasonably consistent with those of the S&P 500 index.
ISSN:1068-0896
2168-8613
DOI:10.3905/joi.7.2.6