Continuing on the theme, Edward F. McQuarrie takes a unique approach to the issue of alternative weighting. McQuarrie says that the S&P 500 is actually an alternatively weighted index, and that its long-term outperformance against the “total market” shows that alternative weighting can work.

Matt Hougan then offers his review of a soon-to-be published article by Andre Perold, which is really a frontal attack on the noisy market hypothesis and some of the new alternative weighting schemes, including those by FTSE RAFI and WisdomTree. This paper is actually debated in our Smackdown feature, so you know it’s a hot topic of discussion at the moment.

Rounding out our coverage of the alternatively-weighted space is Luciano Siracusano with WisdomTree’s first Journal of Indexes submission. It is a brazenly WT-centric view of the investing world, but one that we found extremely entertaining for its thrusts and parries at their competition.

Looking at fixed-income indexing is the always lively Ron Ryan, with a perspective on the growing pension liability market. Ryan thinks that the current range of indexes is inherently flawed, and says he’s got the solution. Arijit Dutta and Eric Jacobson of Morningstar have similar feelings about the broader bond market, but they reach very different conclusions.

Bringing us home this issue is Professor Haslem with his Reading Room, Dr. Blitzer with his wisdom and the Curmudgeon with his whimsy.

By the time you read this, it will be nigh time to send in your nominations for the Sharpe Awards. Visit www.indexuniverse.com for all the details.

Best returns,

Jim Wiandt
Editor