In effect, the index, and consequently all funds tracking the index, are announcing ahead of time the trades that they are planning to make, allowing value to be siphoned by arbitrageurs, in a practice known as "index front running".
In effect, the index, and consequently all funds tracking the index, are announcing ahead of time the trades that they are planning to make. As a result, the price of the stock that has been removed from the index tends to be driven down, allowing value to be siphoned by arbitrageurs, in a practice known as "index front running".