Index-based investments, from index funds to index-based exchange traded funds, have become so popular recently that a group of investors has created a new web site in the Caribbean that allows investors to bet on the future price of several indexes.

The site,, has been started by Panagea Holdings Ltd. of St. John's, Antigua.

But as popular as the site may become to index-enthusiasts, its creators do not think it will take any business away from index funds due to the nature of their investment. Index funds pulled in $4.2 billion in July alone, according to Financial Research Corp. of Boston.

"We're really going to be geared toward the more active traders. I don't think we're going to keep investors away from index funds," said Joe Tighe, co-founder and chief executive officer of

At the site, investors can bet on the rise and fall of several U.S. indexes, including the S&P 500 and Nasdaq 100. International indexes such as the German DAX 30 are also included. Investors can also bet on gold and silver futures, exchange rates and government bonds. The company makes money as a market maker, not on commissions but off the spread at which it buys and sells investments.

Tighe said he has based his operation outside the U.S. because he is uncertain how U.S. regulators would view the trading of index futures. The company has a license from Antigua's gaming commission.

Antigua gave his company a gaming license for $100,000 because it did not know how to regulate the site, Tighe said. His company is working with the government to create legislation that would regulate the site, he said.

Tighe said the trading on index futures through his site is a variation on futures investing, not gambling.

"If we're gambling, then all futures trading is gambling," Tighe said. is hoping to bring in business from so-called "day traders" who, while being active traders, prefer the ease of trading on indexes to trading individual stocks. He said index futures are also an alternative to not only buying stocks, but also to buying now popular S&P Depository Receipts. These are unit investment trusts that trade on the American Stock Exchange like stocks.

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