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Index Funds launches new S&P 500 index fund

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Index Funds has launched its first index mutual fund, the Index Funds S&P 500 Equal Weight fund (INDEX).

“There’s a good reason why USD7 trillion USD are benchmarked to the S&P 500 Index, most investors and managers can’t beat it. We tried to beat the S&P 500 for 20 years and we couldn’t, so we launched a Mutual Fund company solely dedicated to creating low cost index funds,” says Michael G Willis, President of Index Funds.
 
The S&P 500 Index includes 500 leading companies and captures approximately 80 per cent coverage of available market capitalisation. According to the most recent SPIVA report by Standard and Poor’s, 86.44 per cent of large-cap fund managers underperformed the S&P 500 Index last year.
 
National Sales Director, S Todd Johnson, says: “The S&P 500 index is so difficult to beat, we had to find another S&P 500 Index in order to outperform it. After scouring the world of indexes, we found what we believe to be the best kept secret on Wall Street: The S&P 500 Equal Weight Index.”
 
The S&P 500 Equal Weight Index is the equal weight version of the S&P 500 Index. It contains the same constituents as the cap-weighted S&P 500, but each company in the S&P 500 Equal Weight Index is allocated the same weight at each quarterly rebalance. Therefore, the holdings are balanced across all of the S&P 500 companies evenly over time. Whereas, the cap-weighted S&P 500 Index over-weights the 50 largest companies with more than 50% of the holdings.
 
During the past 10 years, Index equity mutual funds have nearly doubled their market share*. We believe this growth trend will continue. Why are investors choosing low-cost index mutual funds over traditional actively managed mutual funds? We believe the answer is simple. Index fund investing lowers costs and removes the noise, allowing investors to focus on what really matters… performance.
 
The Index Funds S&P 500 Equal Weight (INDEX) seeks to replicate, before fees and expenses, the total return of the S&P 500 Equal Weight Index (SPXEW).

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