Andrew Canter: Warning to passive investors - bond indices by nature seriously flawed

As passive investing through index trackers becomes increasingly popular, punters are expanding into bonds, previously the preserve of pension funds. Futuregrowth's CIO Andrew Canter applies his mind to bond indices and explains why they are nearly always deeply and fundamentally flawed. This reality leads to suggestions every now and then that a better measure would be a credit spread index. But Canter explains that in the South African context that would merely raise new problems.