An article in Barron’s profiles the evolution of the Gotham index Plus fund, which was created by Gotham Asset Management founder Joel Greenblatt in an effort to “marry the steadiness of index investing with the market-beating advantage of active management—which, in  this case, means both stock-picking and shorting.”

The fund is now three years old, and the article reports it has returned 15.7% annually since its inception, “ahead of the S&P 500’s 13% and 99% of its peers in Morningstar’s large blend category.”

The article reports that the fund is “invested in the S&P 500 index with an overlay of active management. Greenblatt buys the most undervalued stocks in the index and shorts the most overvalued—a strategy he says will outperform by a greater margin as the bull market slows down.” The fund owns stocks that Greenblatt finds with the help of a research team of 12, including his partner Rob Goldstein—companies with “strong cash flow and good market niches, trading at a discount to their real value.”