Which of the following is NOT a type of indexed portfolio?

Hedge funds are classified as actively managed investment funds that typically employ a variety of strategies to achieve high returns, such as leveraging, short selling, and investing in a wide range of asset classes. They are not bound to track a specific index, which distinguishes them from indexed portfolios.

In contrast, index mutual funds, exchange-traded funds (ETFs), and separately managed accounts (SMAs)/pooled accounts are designed to replicate the performance of a particular market index. Index mutual funds invest in the same securities, in approximately the same proportions, as the index they aim to track. ETFs function similarly but trade on stock exchanges like individual stocks, offering liquidity and flexibility. SMAs and pooled accounts can also be constructed to mimic an index’s performance, providing investors with diversified exposure to specific benchmarks.

Thus, while hedge funds seek to outperform the market through active management, indexed portfolios are specifically designed to mirror the performance of a specific index, making hedge funds the option that does not align with the concept of indexed portfolios.