“These groundbreaking investment tools offer a practical, unique solution for investors who are interested in alternative weighting methods,” said Rolf Agather, managing director of index research and innovation at Russell. “Russell’s research shows that the additional step of equal weighting sectors provides greater diversification benefits than a traditional approach which simply equal weights all constituents.”
He added: “The market-cap approach remains the most popular, and we believe it is the best way to truly reflect market segments. However, we also recognize increasing interest in alternative-weighting products that offer unique beta exposure.”
