Index fund

By | 2017-09-13T14:36:17+00:00 13th September 2017|

An index fund does not attempt to outperform a particular benchmark, but instead aims to match a particular index’s performance by buying the same constituent shares of the index in the same percentage sizes. Success will be measured by the ‘tracking error’ – the amount by which the fund’s return differs from that of the index. Index funds are also known as tracker funds or passive funds.