PIMCO announces RAFI

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Thanks for the nice introduction from earlzhang's blog on Research Affiliates Fundamental Index (RAFI). Basically, it's a new system to determine the weights of portfolios by looking at fundamental factors of companies, rather than capital sizes of them. In my comment posted there, I think it makes more sense from the value perspect, while although my own approach to this question is rather technical, we share the same mindset to give up the capital-based weight system, which, by no means,  can be efficient. However, I must admit that capital-based system makes portfolio managers easier to construct passively managed funds. That's why it's widely adopted.