STOXX Ltd., the leading European index provider, today launched three new indexes that cover Initial Public Offerings (IPOs) in Europe. The Dow Jones STOXX IPO Indexes measure the performance of the European IPO market in three different time horizons — 3, 12 and 60 months — based on the duration a component remains in the respective index.
“Initial Public Offerings are considered more and more as an asset class of its own and increasingly have gained investor attention. The IPO performance effect is a key issue for investors seeking high returns on their investments,” said Lars Hamich, managing director, STOXX Ltd. “The Dow Jones STOXX IPO Indexes offer flexible and investable tools to participate in the performance of this highly dynamic equity market segment from the first day a company is listed.”
The Dow Jones STOXX IPO Indexes are characterized by a unique methodology. Companies with a free-float IPO market capitalization between €100 million and €3 billion are included in the Dow Jones STOXX IPO Indexes. The number of components of each index is variable, but always kept at a 10-stock minimum to ensure stability in the indexes.
For the Dow Jones STOXX IPO Index (3 months), companies are added one day after their actual IPO date and remain in the index for 3 months. This allows maximum participation in the IPO performance effect. The Dow Jones STOXX IPO Index (3 months) is designed to underlie structured products.
For the Dow Jones STOXX IPO Index (12 months) and the Dow Jones STOXX IPO Index (60 months), companies are added on the second Wednesday following their IPO and remain in the index for 12 and 60 months, respectively. In addition, each component’s weight is capped at 20% of the index’s total free-float market capitalization.
