FYI: Market-cap-weighted indexes have their benefits. Funds that track cap-weighted indexes cut back on turnover and the related trading costs. They also grasp the market’s collective opinion of each stock’s relative value, a consensus that has historically proven tough to beat. But using a cap-weighted approach with certain markets or strategies can compromise diversification and intended factor exposure.
Regards,
Ted
https://www.morningstar.com/articles/908611/the-trouble-with-marketcap-weighting.html
