indexadjusted

Indexadjusted refers to a financial concept or adjustment related to how an investment's performance or value is presented in relation to a benchmark index. This adjustment is made to provide a clearer understanding of the actual return or performance generated by a manager or strategy, independent of the general market movements reflected by the index.

In practice, indexadjusted can manifest in several ways. For instance, when evaluating a fund manager's skill, their gross performance might be compared to the net performance after accounting for the performance of a relevant index. This helps determine if the manager added value beyond what could have been achieved by simply investing in the index itself. Another application is in performance attribution, where the total return of a portfolio is broken down into components attributable to market exposure (beta) and active management decisions (alpha). The beta component, often linked to the index, is thus "adjusted" away to isolate the alpha.

The purpose of indexadjusted analysis is to provide a more accurate assessment of performance, risk, and the effectiveness of investment strategies. It's a crucial tool for investors, portfolio managers, and analysts seeking to differentiate between market-driven gains and those resulting from active management expertise. Without such adjustments, it can be difficult to discern the true impact of investment decisions.