STOXX Limited, a global index provider and creator of the leading European equity indices, today announced the launch of the STOXX Europe 600 Optimised Market Quartile Indices. The new indices are part of the STOXX Optimised Index family and classify the components of the STOXX Europe 600 Index into the four market quartiles.
The STOXX Europe 600 Optimised Market Quartile Indices have been licensed to Source to underlie exchange-traded funds (ETF) which will be available in the next couple of weeks.
"With the launch of the STOXX Europe 600 Optimised Market Quartile Indices we are taking an innovative approach to creating index products which offer market participants a way to measure the performance of European companies in relation to economic cycles," said Hartmut Graf, chief executive officer, STOXX Ltd. "The new indices are an addition to our existing Optimised Index family, which applies superior concepts to improve liquidity and diversification in the indices."
Ted Hood, CEO of Source, commented "Source is pleased to continue our collaboration with STOXX and expand the range of optimised European indices. The combination of increased liquidity with the ability to implement market cycle driven investing should prove highly popular."
The STOXX Europe 600 Optimised Market Quartile Indices are based on forward-looking expectations of how certain types of companies respond to changes in the economic cycle. The STOXX Europe 600 Optimised Consumer Discretionary Index covers those companies who are most sensitive to economic cycles, for example automotive companies, hotels and restaurants. The STOXX Europe 600 Optimised Consumer Staples Index represents companies which are less sensitive to economic cycles, such as manufacturers and distributors of food and beverages, tobacco companies or producers of non-durable household goods. The STOXX Europe 600 Optimised Defensive Index represents companies who tend to not be affected by economic cycles, while the STOXX Europe 600 Optimised Cyclicals Index is comprised of companies in the index universe which tend to follow economic cycles. All of the components of the STOXX Europe 600 Optimised Supersector Indices fall into one of the four Market Quartiles.
The classification of the individual companies into the four categories is based on various criteria: the company's subsector classification according to the Industry Classification Benchmark (ICB), fundamental factors, broader market views and input from market participants.
The STOXX Europe 600 Optimised Market Quartile Indices follow the same methodology as the STOXX Optimised Indices. The most defining features of this index family is, that they take into account the ability to borrow a stock in the stock lending market, a key component in facilitating active trading in the underlying index constituents and related products. To incorporate this unique aspect, STOXX uses data provided by Data Explorers, the unique provider of global, independent data, analytics and insight into short selling and securities lending.
The STOXX Europe 600 Optimised Market Quartile Indices are available in price and net return versions, and are reviewed quarterly in March, June, September and December. The indices are weighted by float-adjusted market capitalization and calculated in euro.
Further information on the STOXX Europe 600 Optimised Market Quartile Indices is available at www.stoxx.com.
