Investment strategies based on indices have been around for decades, but in the past 10 years their popularity has risen significantly. There has been a proliferation of indices developed by banks and other financial services firms for investors wanting a performance target for their portfolios and, as a consequence, a rise in the number of index-linked securities offered by those institutions.
Many indices and products related to them, such as those designed by UK firm Markit, are for the use of a wide array of investors. Others are more bespoke and are sometimes even devised for a single client.
