For over a decade, exchange-traded funds have been using the label “smart beta” to describe rules-based indexes that differ from those using traditional market-cap weighting. Now a leading mutual fund group is joining the smart-beta movement with a fund that uses a very long-term rearview mirror to determine whether sectors are undervalued or overvalued.
The equity side of the DoubleLine Shiller Enhanced CAPE fund follows the Shiller Barclays CAPE U.S. Sector Index, a value index constructed using the cyclically adjusted price-to-earnings ratio (CAPE) rather than the more traditional trailing-12-month price-to-earnings ratio. (For more background on CAPE and the views of its creator, noted economist Robert J. Shiller, see the sidebar.) That “smart beta” index is paired with a low-volatility, actively managed fixed-income portfolio.
DoubleLine’s Smart-Beta Fund Is A Hit
July 1, 2015
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