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STOXX Limited, a leading provider of innovative, tradable and global index concepts, today announced the launch of the iSTOXX MUTB Global Quality Indices that capture the performance of quality companies with high profitability, low leverage and sustainable cash flows globally. The new indices have been licensed to Mitsubishi UFJ Trust and Banking Corp. (MUTB) the leading Japanese trust bank, to be used for an institutional passive fund.
“We are delighted to extend our collaboration with Mitsubishi UFJ Trust and Banking Corp. by developing the iSTOXX MUTB Global Quality Indices. By that we follow the memorandum of understanding we entered last year, with the aim to create and market new smart-beta indices for the Japanese region,” said Hartmut Graf, chief executive officer, STOXX Limited. “The newly launched indices offer local and international market participants an innovative and rules-based tool to participate in the performance of quality companies that are derived from the universe of the renown benchmark STOXX Global 1800.”
Sunao Yokokawa, Managing Executive Officer of Mitsubishi UFJ Trust and Banking Corp. commented: ”The iSTOXX MUTB Global Quality Indices are the global version of the iSTOXX MUTB Japan Quality 150 Index, launched last August as the first index developed in collaboration with STOXX Limited. I believe that these indices will help us further expand our global asset management business. Going forward, we strive to actively develop various smart-beta strategies with STOXX, leveraging our expertise in both active and index investment management."
The iSTOXX MUTB Global Quality 150, iSTOXX MUTB Global ex Japan Quality 150 and iSTOXX MUTB Global ex Australia Quality 150 indices are derived from the STOXX Global 1800 Index and its ex Japan and ex Australia subsets, respectively. Each universe is divided into three regions: North America, Europe and Asia/Pacific. The components of the selection list have to fulfil screening criteria for each region according to four fundamentals ratios (return on equity, debt-to-capital, cash flow generation ability and business stability). In a next step, a quality score is calculated and a liquidity screen applied. The components are then ranked according to these scores. The top 150 stocks are selected as components of the respective index, applying a 5% buffer based on the composite quality score.
The iSTOXX MUTB Global Quality Indices are weighted by free-float market cap, with a single component’s weight cap of two percent. The indices are reviewed semi-annually in June and December after the review of the underlying index, and rebalanced quarterly in March, June, September and December.
The iSTOXX MUTB Global Quality Indices are calculated in price, net and gross return versions. The iSTOXX MUTB Global Quality 150 Index is available in Australian dollar, Euro, Japanese yen and US dollar. The iSTOXX MUTB Global ex Japan Quality 150 and the iSTOXX MUTB Global ex Australia Quality 150 indices are available in Euro, US dollar and the respective local currency. Daily historical index values are available from Dec. 20, 2002.
