Editing Index fund (section)

===Synthetic indexing===
Synthetic indexing is a modern technique of using a combination of equity index futures contracts and investments in low-risk bonds to replicate the performance of a similar overall investment in the equities making up the index. Although maintaining the future position has a slightly higher cost structure than traditional passive sampling, synthetic indexing can result in more favorable tax treatment, particularly for international investors who are subject to U.S. dividend [[withholding tax]]es. The bond portion can hold higher yielding instruments, with a trade-off of corresponding higher risk.