Charles Schwab Investment Management has announced that it plans to start two mutual funds this month based on the FTSE RAFI Fundamental index series.
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The Schwab Fundamental Emerging Markets Index Fund is to invest in stocks that are in an FTSE RAFI index consisting of 350 emerging-markets companies, the unit of Charles Schwab Corp. said on Wednesday.
The Fundamental International Small-Mid Company Index Fund is to be based on index of about 1,500 companies in industrialized countries other than the United States and ranked by sales, cash flows, book value, and dividends.
The fundamental indexes depart from the more common market-capitalization-weighted structure, which overweight overvalued companies and underweight undervalued companies.
