judyth

Determine some of the Indexing Methodologies of Indexing Strategy of Passive portfolio management.

Hi community! I would be very grateful if someone could help me with the details of the Indexing Strategy of Passive portfolio management "Indexing Methodologies"?
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attourney
"Indexing Methodologies: 1. Methods of Construction: Stratified sampling or Cellular Approach,Optimization Approach, Variance Minimization Approach 2. Utmost care must be taken to minimize the tracking error caused by : Transaction costs in construction of the index, Differences in the composition of the indexed portfolio and the index itself, Discrepancies between prices used by the organization constructing the index and the transaction prices paid by the index manager. Source: http://in.docsity.com/en-docs/Bond_Portfolio_Management_Strategies_-_Security_Analysis_and_Portfolio_Management_-_Solved_Quiz_"
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arunima
"Active investment managers are labled ""active"" because they tend to trade positions more frequently in response to ever-changing perceptions of mispriced securities or because they actively attempt to identify mispriced securities and future trends. Active managers believe research, skill and intelligence are the primary drivers of investment success. "
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