What is a strategy weighted index fund? Many financial novices have no concept of the strategic weighted index fund, and do not know what the strategic weighted index fund is. Here is a brief introduction for you, hoping to help you.
The strategy weighted index selects stocks according to strategies, not only to see the market value of listed companies. Since it is a strategy to select and weight stocks according to different strategies, it will produce different results and form different indexes. At present, there are five most popular strategies for weighting.
1. Equal weight strategy: representative industries include pension industry and environmental protection industry;
2. Dividend strategy: Weighted by dividends, the index has dividend and bonus opportunities of CSI;
3. Fundamentals strategy: it mainly examines the fundamentals of the company. The representative indexes are Fundamentals 50 and 60;
4. Value strategy: the representative index has 300 values;
5. Low volatility strategy: the representative index has 500 low volatility.
The stock selection rule of CSI dividend is based on the dividend yield of stocks. It is the 100 stocks with the highest dividend yield in Shanghai and Shenzhen Stock Exchanges. At the same time, the weighting rule of CSI dividend is the dividend yield strategy. The higher the dividend yield, the higher its share in the index.
The market capitalization weighted index is more important in the stock market. It is more stable and has a larger scale. The overall scale of the strategy weighted index is smaller, but it is a small and beautiful variety. It can use various strategies to make the index more profitable. It is a good choice for ordinary investors with small capital.
We all know that indexes can be divided into two categories: one is broad based index and industry index; The second type is market capitalization weighted index and strategy weighted index. But how should we ordinary investors choose?
We all know that broad base index funds are more stable and more suitable for novices, so for friends who are just beginning to invest, broad base index funds are the first choice. After accumulating more experience in the future, we will consider industrial index funds.
