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  • The Tracking Error (TE) is a measure to assess how close an ETF tracks the index. This gives a reasonable tool to check the stability of the ETF tracking ability. While the volatility gives a general risk on the return of the ETF and is directly attached to the volatility of the index, the TE presents an additional risk measure that highlights the risk of the replication and not the Market risk.

  • The primary objective of an ETF is to track its index. In the best-case scenario, the ETF’s tracking difference is expected to equal the ETF fees. However, it is very rare that this scenario happens, ETFs providers either beat this expected return or the other way around, tend to present worst performance.

  • ETFs may have several similarities in their investment strategy such as the asset class they cover, the geographical exposition, the sector or the maturity. Hence the TrackInsight team created the “TrackInsight Segments” to give users the opportunity to monitor the global industry at a glance and get an unequalled tool for macro analysis.