... It's an investment strategy that overweights value stocks.
As the short but incisive paper Fundamentally Flawed Indexing by Harvard Finance prof André Perold, demonstrates with a simple example and a mathematical model, the idea that cap-weighted passive indexing will systematically under-perform because it tends to hold more over-valued stocks doesn't hold water. Any outperformance of fundamental indexing compared to normal cap-weighted indexing can only be due to the higher-risk higher-return greater investment in value stocks (those with higher Price/Earnings ratios or other fundamental data).
Perold's conclusion: "... Holding a stock in proportion to its capitalization weight does not change the likelihood that the stock is overvalued or undervalued. The notion that capitalization weighting imposes an intrinsic drag on performance is, accordingly, false. Fundamental indexing is a strategy of active security selection through investing in value stocks."