Index funds offer investors access to a wide variety of different strategies and asset classes, with the added benefits of simplicity, liquidity and ease of implementation.
Typically, index funds have lower management fees than active funds, but also have lower activity levels too, thus benefiting from lower transaction costs. Investors still enjoy the same broad market exposure, but in a more cost effective manner.
Why LGIM for index fund management?
There is more to index fund management than simply following an index. Legal & General Investment Management ('LGIM') is one of the largest index fund managers in the world. LGIM’s success has been built by focusing on the provision of cost effective solutions which meet clients' specific requirements. This can be seen in several key attributes:
- Responsible and value-enhancing approach – An index fund can still be an active shareholder. We engage with the companies whose shares we hold to encourage best practice and increase shareholder returns. We aim to provide investors with all that they are entitled to as a passive holder of securities rather than just index returns.
- Product diversity - We work with index providers to bring our clients new investment opportunities across different capital markets, enabling a high degree of customisation.
- Operating model aligned with clients' interests - We provide fund management services free from many of the conflicts of interest encountered in fund management firms which are also involved in broking, banking or custody, as we have no affiliates involved in these or related activities.
- Value-added services - We complement our index fund management offering with a dedicated range of services such as currency hedging, transition management and asset allocation.
- Award-winning client service - Our client-focused approach and first class client servicing standards are recognised within the industry. We continue to win industry awards for our client service.
- Commitment - Index fund management is core to our business strategy and our commitment to passive management is unequivocal, as shown by our ongoing innovation and delivery of value for money solutions.
If you are looking for a brief overview of key economic trends across the globe, we write Macro Snapshot, on a monthly basis. For more in-depth views, we also produce Fundamentals, a regular publication which details topical thinking from LGIM’s economists.