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RAFI™ Fundamental Indices

DATA AS OF: 2017-12-31

The RAFI Fundamental Indices use the Research Affiliates’ Fundamental Index™ methodology, which weights companies based on fundamental measures of company size (as measured by accounting variables) rather than their market capitalization. 

Rulebook

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Available Indexes

Click the links highlighted in green to learn about the expected and historical index performance available as of January 2018. Expected and historical index performance for indices not highlighted in green will be made available at a later date.

RAFI Fundamental Global Index — RAFIGLBT

RAFI Fundamental U.S. Index — RAFIUST

RAFI Fundamental Developed ex-US Index — RAFIDXUT

RAFI Fundamental Emerging Markets Index — RAFIEMT

RAFI Fundamental Developed Index — RAFIDEVT

RAFI Fundamental Europe Index — RAFIEURT

RAFI Fundamental U.S. Small Company Index — RAFIUSST

RAFI Fundamental U.K. All Company Index — RAFIUKAT

AT A GLANCE

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Breaking the link between price and weight

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Embedding a buy-low, sell-high approach

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Thoughtfully designed and highly implementable

Investment Process

investment process

RAFI™ Fundamental Index™ is built on the principles of contrarian investing and disciplined rebalancing.

Traditional passive investment vehicles are market-capitalization weighted, which means that as the price of a security increases, so does its weight in your portfolio. This results in overweights to the most overvalued companies and underweights to the most undervalued companies.

RAFI Fundamental Index is a non-price-weighted index strategy that aims to deliver excess return versus the cap-weighted benchmark by using fundamental measures of company size to systematically rebalance against the market's constantly shifting expectations.

Thoughtfully designed to deliver for investors

Breaks the link between price and weight
Using fundamental measures of company size to sever the link between price (market capitalization) and portfolio weight, RAFI Fundamental Index strategies avoid significant overweights to the trendy, popular, and most expensive securities.

Engages in contrarian rebalancing
RAFI Fundamental Index strategies utilize a systematic rebalancing process that embeds a buy-low, sell-high approach within the index strategy. Using a company's fundamental weight as a rebalancing anchor, the Fundamental Index approach systematically rebalances out of securities whose prices have increased, while rebalancing into securities whose prices have fallen and have more attractive relative equity valuations.

Benefits the investor
A systematic, fully transparent approach that preserves all the benefits of traditional passive investing: broadly diversified, low cost, and high investment capacity.

Performance

Source: FactSet | Data: As of 12/31/2017 in USD | Inception Date: 01/31/2017

Note: Portfolio characteristics derived from FactSet. Data prior to launch is simulated.

*Inception to Date (ITD) uses the first full month of returns after inception date. All returns prior to inception are simulated. Please see disclosures for important information regarding simulated performance.

RAFI Indices is built with the research, insights, and strategies of our sister company: Research Affiliates, LLC