The Relevance of Index Funds for Pension Investment in Equities

Show simple item record

collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
Shah, Ajay
dc.contributor.author
Fernandes, Kshama
dc.date.accessioned
2014-08-27T18:42:46Z
dc.date.available
2014-08-27T18:42:46Z
dc.date.issued
2000-11
dc.description.abstract
The rise of index funds over the past 25 years has been a remarkable phenomenon. The traditional rationale for the success of index funds is market efficiency, net of transaction costs. The authors also focus on the role of agency conflicts between fund managers and investors, which are hard to resolve, given the low power of statistical tests of performance. Most of the empirical evidence about the superiority of index funds comes from the United States. The authors discuss issues associated with the application of index funds in developing countries, as well as policy issues in the financial sector that affect the enabling market infrastructure for index funds. They also apply these ideas to thinking about the relevance of index funds for pension investment. The equity premium provides powerful motivation for equity investment by pension funds. Index funds make it possible to sidestep the complexities of forming contracts and monitoring institutions to govern fund managers. In developing countries that seek to use index funds in pension investment, there are avenues through which policymakers can make index funds more viable. In many countries there are significant avenues for improving construction of the market index as well as market mechanisms used in the equity market.
en
dc.identifier
http://documents.worldbank.org/curated/en/2000/11/729385/relevance-index-funds-pension-investment-equities
dc.identifier.uri
http://hdl.handle.net/10986/19773
dc.language
English
dc.language.iso
en_US
dc.publisher
World Bank, Washington, DC
dc.relation.ispartofseries
Policy Research Working Paper;No. 2494
dc.rights
CC BY 3.0 IGO
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo/
dc.subject
ASSETS
dc.subject
AUCTIONS
dc.subject
BENCHMARK
dc.subject
BONDS
dc.subject
COLLATERAL
dc.subject
CONTESTABILITY
dc.subject
CUSTODY
dc.subject
DEALERS
dc.subject
DERIVATIVES
dc.subject
DIMINISHING RETURNS
dc.subject
DIVIDENDS
dc.subject
ECONOMICS
dc.subject
EMERGING MARKETS
dc.subject
EXPENDITURES
dc.subject
FINANCIAL SECTOR
dc.subject
GDP
dc.subject
INDEXATION
dc.subject
LIQUIDITY
dc.subject
MARKET FLUCTUATIONS
dc.subject
MARKET RETURNS
dc.subject
MERGERS
dc.subject
MUTUAL FUND
dc.subject
NEGATIVE EXTERNALITIES
dc.subject
PENSION FUNDS
dc.subject
PORTFOLIO
dc.subject
PRICE FLUCTUATIONS
dc.subject
PURCHASES
dc.subject
REINVESTMENT
dc.subject
SHAREHOLDERS
dc.subject
SPREAD
dc.subject
STOCKS
dc.subject
TRANSACTIONS COSTS
dc.subject
TURNOVER
dc.subject
WEALTH
dc.title
The Relevance of Index Funds for Pension Investment in Equities
en
okr.date.disclosure
2000-11-30
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.doctype
Publications & Research
okr.docurl
http://documents.worldbank.org/curated/en/2000/11/729385/relevance-index-funds-pension-investment-equities
okr.globalpractice
Macroeconomics and Fiscal Management
okr.globalpractice
Finance and Markets
okr.globalpractice
Trade and Competitiveness
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-2494
okr.identifier.externaldocumentum
000094946_00121302021466
okr.identifier.internaldocumentum
729385
okr.identifier.report
WPS2494
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2000/12/22/000094946_00121302021466/Rendered/PDF/multi_page.pdf
en
okr.sector
Capital Markets Development
okr.sector
Finance
okr.topic
Economic Theory and Research
okr.topic
Macroeconomics and Economic Growth :: Markets and Market Access
okr.topic
Agricultural Knowledge and Information Systems
okr.topic
Payment Systems and Infrastructure
okr.topic
International Economics and Trade :: Access to Markets
okr.unit
Finance, Development Research Group
okr.volume
1

Show simple item record



This item appears in the following Collection(s)