The Economist Simulation Brief Quantitative Market Dynamics 50-Year Horizon Model

Index Fund Active Mechanics Engine

“The idea that index funds are passive is bunk. Investing in an index involves critical active design choices—from weighting rules and buffers to governance concentration.”
Active Choices
Final Portfolio Value
$0
0.00% p.a.
Annualized Return
0.00%
Net of turnover friction
Annual Turnover Drag
0.00%
$0 / year
Top 5 Concentration
0.00%
Weight in top 5 holdings
Governance Power
0.00%
Index Manager Voting Share
1. Portfolio Value Trajectory vs Baseline Benchmark
Selected Index Strategy
Market Cap Baseline
2. Top-5 Holding Concentration vs Manager Governance Voting Share
Top 5 Concentration (%)
Governance Voting Power (%)

Strategy Evaluation: Market-Cap Drift Baseline

Simulating 30-year index performance. Passive indexing relies on active design rules: market-cap weighting naturally lets winning stocks expand, driving high top-5 concentration while minimizing rebalancing turnover.
Portfolio Value: $0 Ann. Return: 0.00% Turnover: 0.00% Top 5 Share: 0.00% Gov. Share: 0.00%
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