Indexing management

An investment style that attempts to closely match the investment returns of a specified group of shares, bonds or other securities, usually represented by a recognized index. An index manager seeks to construct a portfolio that holds all, or a representative sample of the securities in the index, and closely tracks the investment returns of the target index. Not a short-term investment strategy, indexing achieves broad diversification within a specific index and low portfolio turnover through what is known as a "by and hold" approach. One benefit of this approach is a significant reduction in the cost of investing over time, which may lead to better returns.