[eru]

> Yes, most index funds don't literally intend to own the entire market for any sufficiently broad interpretation of the word "entire."

I mean that your index doesn't even have to own a segment of the market. Just look at eg how the Dow Jones Industrial Average is constructed. When a company has a stock split, it changes its weight in that index. That has nothing to do with 'the market'. (Stock splits have approximately no influence on your weight in the S&P500.)

Or you could have an index that captures all the stocks whose ticker starts with X minus those that start with Y plus the current temperature in Frankfort, Kentucky, in Rankine degrees.