Original Articles

The application of fundamental indexing to the South African equity market for the period 1996 to 2009

Published in: Investment Analysts Journal
Volume 40, issue 73, 2011 , pages: 1–12
DOI: 10.1080/10293523.2011.11082533

Abstract

Over the years the norm in the investment industry has been to use market capitalization-weighted indices as benchmarks to measure investment performance. However, market capitalization-weighted indices, such as the FTSE/JSE All Share Index (ALSI), create a natural return drag because of the overweighting of overvalued stocks and vice versa.

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