The manager of a passive mutual fund or exchange - traded fund (ETF) will seek to achieve the
return of a particular index, before expenses — nothing more, nothing less.
2Exchange Traded Funds seek investment results that, before expenses, generally correspond to the price and
yield of a particular index.
Therefore, the performance of an ETN may be affected by both the performance
of the particular index as well as the credit rating of the issuer.
As an investment strategy, trading these spreads using Bollinger bands isn't really advisable, but it's clear that the downside
risk of a particular index (relative to the S&P 100) is greater at the top band than at the bottom.
Examples: Assume you purchase a leveraged ETF that is designed to double the return
of a particular index on a given day.
Dispersion is a cross-sectional measure — that is, it tells us at any point in time whether the
constituents of a particular index are behaving largely alike or largely differently.
The point at the end is that if you want 2x the return
of a particular index from time A to time B, the best way to get that return is to use margin on the underlying, not to use a daily levered ETF.
Exchange Traded Funds seek investment results that, before expenses, generally correspond to the price and
yield of a particular index.
One of the benefits of an IUL is that the interest is credited based in part on the performance
of a particular index that the IUL tracks.
While a mutual fund is typically built and actively managed by a professional money manager, ETFs generally employ a more passive approach: they try to replicate the holdings, weightings and / or performance
of a particular index.
If you'd like to try to achieve a performance similar to
that of a particular index, you can either directly copy the index on your own (by buying all of the individual securities in the index) or purchase shares of a index mutual fund or exchange - traded fund that essentially replicates the index.
Your return on investment is based on a formula that tracks the gains (or losses)
of that particular index.]
Index fund Index funds (also known as passive funds or «trackers») aim to track the performance
of a particular index, such as the FTSE 100 or S&P 500.
They typically guarantee some minimum return but are linked to the performance
of a particular index, such as Standard & Poor's 500 index.