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Following the successful launch of the Solactive Euro IG Corporate Index tracking the performance of the EUR-denominated investment grade bond market, Solactive AG is announcing the release of two new fixed-income benchmarks, namely the Solactive Euro HY Corporate Index and the Solactive USD High Yield Corporate Index. These benchmarks are designed to provide a snapshot of non-investment grade bond markets denominated in EUR and USD, respectively. This is a premiere for the German index engineer whose branded benchmarks have until now focused on the investment grade space, thus bringing the Company one step closer to offering complete coverage of the fixed-income market.
The launch of the new benchmarks represents a further move towards Solactive’s strategic goal of expanding its product range and include broad market indices, in addition to the customised smart beta offering. Solactive benchmarks can serve multiple purposes. Firstly, investors can use them as reference standards to compare and evaluate portfolio results. In addition, they can provide a starting universe on which to build investment strategies or smart-beta indices. Then, benchmarks can constitute a basis for investment products such as ETFs. Lastly, they can provide analytics of market performance across countries, regions, or sectors.
Astrid Ludwig, Head of Indexing, Solactive AG, commented: “The incorporation of benchmarks into our business model aims at broadening the range of index products offered, thus responding to the needs of a wider customer base looking for aggressive pricing on broad market indices covering the fixed-income asset class. As shown by our previous benchmarks launches, Solactive can effectively capitalize on its indexing infrastructure and operations to provide cost-efficient benchmarking solutions.”
The Solactive Euro HY Corporate Index and the Solactive USD High Yield Corporate Index are composed of corporate debt issued in developed and developing markets. Both indices are Total Return indices and are rebalanced monthly. All index components have a rating that is sub investment grade and the amount outstanding must be at least EUR 150 million and USD 400 million, respectively. The EUR index is based on 1000 at the close of trading on the 29th of December 2006. The USD index is based on 1000 at the close of trading on the 31st of January 2005.
