SEC Offers Guidance to Investors on Traditional and Non-Traditional Index Funds

The SEC Office of Investor Education and Advocacy ("OIEA") provided investors with guidance on traditional and non-traditional index funds.

In the first bulletin, the OIEA provided basic information on traditional index funds as well as their associated costs and risks. In the second bulletin, the OIEA described certain types of non-traditional index funds (e.g., Smart Beta, Quant Funds, and Environmental, Social and Governance Funds), explained the differences between these funds, and traditional index funds and urged investors to consider these funds in relation to market returns, diversification, complexity and cost.