05-08-2026 15:52 via moneyweek.com

Should you pick an equal- or market cap-weighted index?

If you’re buying an index fund or exchange-traded fund (ETF) that tracks a particular index, there are two main options you can choose. An equal-weighted index fund is exactly that – a fund where all components (shares or bonds) are the same size.Conversely, a market cap-weighted index fund allocates proportionately, so the larger companies’ stock or bonds make up a higher share of the index and the smaller companies’ stock or bonds comprise a smaller amount. If the point
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