Investors can have a hard time identifying "closet indexing"--when an actively managed fund actually is built around an index--but new measures might be useful to predict fund performance.

Antti Petajisto and Martijn Cremers, two Yale University professors, developed an easy way of measuring to what degree a fund's holdings are actively managed, as opposed to passively mirroring an index, according to The Wall Street Journal. The measure, called the "active share" of a portfolio, matches the holdings reported by Securities and Exchange Commission filings against the components of an index, and then measures the percentage of overlap.

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