Russ Kinnel says tracking error can help investors see how similar a fund's performance is to that of its benchmark.

What Is ‘Tracking Error’ in Oil Funds? Price changes in ETFs such as U.S. Oil Fund don’t always closely track changes in the price of the commodity By Simon Constable Follow ...

Other reasons tracking errors might occur is because of limits to a specific stock weighting within an ETF or the existence of hard-to-trade securities. [Tracking Error: What It Is and How It ...

The risk of your portfolio trailing popular benchmarks, such as the S&P 500, is a real risk that investors must take into account ...

Tracking Difference is the absolute difference between the returns of the fund and those of the benchmark at the end of the chosen investing period. For example, if you hold a passive fund for three ...

As the markets have gotten more volatile, and a number of hedge funds and a range of ‘alternative’ investment strategies have generated substantial losses, ...

Essentially, extraordinary tracking errors (over 2%) mean that there is most likely some active fund management going on and put bluntly, the fund isn’t achieving its mandate--to track its index.

Tracking error can clearly matter to big institutional investors trading very large volumes and fretting over even the tiniest price variations.

What is a tracking error? Why do you need to know this definition? The MoneySense Glossary is your resource for learning and understanding financial terms.

Tracking Error is the variation between the performance of a portfolio and the performance of the portfolio’s benchmark over time. Why would there be a difference?