In an extraordinary year marked by innovation and growth, leave it to the venerable Dow Jones Industrial Average to provide the signature moments for Dow Jones Indexes in 2011.
On May 26, 2011, the iconic index celebrated its 115th anniversary, an “historic milestone” according to Mayor Michael Bloomberg, who officially proclaimed the date as “Dow Jones Industrial Average Day” in New York City. Nearly five months later, on October 18, two regional versions of The Dow were launched -- The Asia Dow and The Europe Dow, both of which operate according to the same guiding principles as the DJIA.
“We’ve taken 115 years’ worth of experience from the Dow Jones Industrial Average and applied it to The Europe Dow and The Asia Dow,” said John Prestbo, Editor and Executive Director of Dow Jones Indexes.
Among the other 2011 highlights for the global index provider:
- a surge of new dividend indexes, including those for Europe, the Eurozone and emerging markets;
- critical additions to the Dow Jones-UBS Commodity Indexes series, with innovative launches for Roll Select, forward blend and currency hedged offerings;
- a significant expansion of its European suite of market measures, underscoring Dow Jones Indexes’ revitalized commitment to the region; and
- the winning of four more awards for its highly decorated Dow Jones Islamic Market Indexes series:
- “Best Islamic Index Provider” by Islamic Finance News;
- “Best Islamic Index Provider” by Islamic Business & Finance,
- “Islamic Index Provider of the Year in Asia” by Asia Asset Management; and
- “Best Shari’ah Compliant Index Provider of the Year” by Global Finance.
“Two-thousand eleven was a memorable year for Dow Jones Indexes,” said Michael A. Petronella, President, Dow Jones Indexes. “Among our accomplishments this year, we launched regional versions of our flagship Dow Jones Industrial Average in Asia and Europe, made a host of impressive additions to two of our most popular index families -- commodities and dividends – and successfully expanded our suite of offerings in Europe.
“More than anything,” he continued, “2011 proved that my Dow Jones Indexes colleagues not only possess the vision to improve our business in a challenging environment, but are resolute in their determination to set goals and see them through to completion. This commitment -- both to clients and fellow colleagues – stands as a fitting tribute to their dedication and professionalism.”
The year also featured a 40% jump in the number of indexes licensed to underlie ETFs in 2011 compared to 2010 (28 vs. 20); licensed indexes included:
- eight indexes from the Dow Jones Emerging Markets Sector Titans Indexes series;
- seven gauges from Dow Jones U.S. Thematic Market Neutral Indexes series;
- published with SAM, the Dow Jones Sustainability World Enlarged ex All/AE Index and the Dow Jones Sustainability Europe ex All/AE Index;
- The Global Dow, which measures the stock performance of 150 of the world’s leading companies;
- published with Brookfield Asset Management, the Dow Jones Brookfield Emerging Markets Infrastructure Index and the Dow Jones Brookfield Global Infrastructure Index;
- the Dow Jones Global Shipping Index, which measures the performance of 25 leading dividend-paying companies in the shipping industry.
Other notable achievements for Dow Jones Indexes in 2011 included:
Launches
- Expansion of index offerings in the European markets:
- three blue-chip indexes: the Dow Jones Europe Titans 80 Index, Dow Jones Eurozone Titans 80 Index both measure leading stocks traded in the developed markets of Europe and The Europe Dow, an equal-weighted index that measures 30 of the continent’s leading blue-chip stocks;
- three series of indexes designed to measure various targeted levels of volatility: the Dow Jones Europe Titans 80 Volatility Risk Control Indexes, Dow Jones Eurozone Titans 80 Volatility Risk Control Indexes and Dow Jones BRIC 50 Volatility Risk Control Indexes. Each series includes four indexes that seek to measure predetermined levels of market volatility by dynamically allocating weights between an underlying index component and a cash component;
- seven dividend-focused indexes: the Dow Jones Europe Select Dividend 30 Index and Dow Jones Eurozone Select Dividend 30 Index measure the performance of 30 of the highest dividend-yielding stocks traded in the developed markets of Europe. The Dow Jones Switzerland Select Dividend 15 Index measures the stock performance of high dividend-paying companies in Switzerland. The Dow Jones Europe Select Dividend 30 Distributing Index and Dow Jones Eurozone Select Dividend 30 Distributing Index, both a theoretical cash component designed to reflect the cumulative regular net cash dividends paid by the constituents of the base index. The distributing indexes reflect distribution of the accumulated cash on a semi-annual basis; and Dow Jones France Select Dividend 20 Distributing Index, Dow Jones Germany Select Dividend 20 Distributing Index are versions of the Dow Jones France Select Dividend 20 Index and the Dow Jones Germany Select Dividend 20 Index;
- two real estate indexes: the Dow Jones Europe Developed Markets Select Real Estate Securities Index (RESI) represents equity real estate investment trusts (REITs) and real estate operating companies traded in the developed markets of Europe;Dow Jones Europe Developed Markets Select REIT Index is a subset of the RESI index, covering only REITs;
- in collaboration with Forex Capital Markets LLC, launched the Dow Jones FXCM Dollar Index, which measures the value of the U.S. dollar against a basket of the world’s most liquid currencies;
- in collaboration with Transparent Value, launched six new indexes to the Dow Jones RBP Indexes family, including a small-cap index; a gauge that measures the largest 50 U.S. stocks, ranked by RBP® probabilities that have first passed the screens for Shari’ah compliance; and three large-cap “style” indexes of growth and value;
- in collaboration with Credit Suisse Index Co., LLC, launched the Dow Jones Credit Suisse Core Hedge Fund Index, the first and only hedge fund index that reflects the performance of managed accounts and other regulated fund structures sourced from multiple best-in-class managed account platforms, creating an unparalleled view of the liquid, investable hedge fund universe;
- in collaboration with the Federation of Euro-Asian Stock Exchanges (FEAS), the launch of the first blue-chip index derived from Euro-Asian stock exchanges -- the Dow Jones FEAS Titans 50 Equal Weighted Index, an equal-weighted measure of the 50 largest stocks traded on FEAS-member exchanges;
- in collaboration with BBVA, launched the Dow Jones BBVA EAGLEs Indexes series, which includes two gauges each designed to measure the stock performance of 50 leading companies in emerging and growth-leading economies (EAGLEs);
- in collaboration with LVA Indices S.A. and Proveedor Integral de Precios S.A. de C.V., launched four bond indexes for Costa Rica as part of the Dow Jones LATixx Indexes family. These indexes are designed to measure the performance of Costa Rican government debt instruments in local currency and U.S. dollars;
- the Dow Jones Global Commodity Equity 100 Index, the flagship of a new index series that measures the stock performance of companies engaged in the exploration or production of both scarce and renewable commodities; and
- the Dow Jones Islamic Market Global Finance & Takaful Index, which measures the performance of financial services stocks that pass rules-based screens for Shari’ah compliance. Insurance stocks that pass such screens are known as Takaful.
Co-Branding
- For the second consecutive year, New York was ranked as the leading international financial center, according to the Xinhua-Dow Jones International Financial Centers Development Index. Jointly launched in 2010 by Dow Jones Indexes and a subsidiary of China’s Xinhua News Agency, the gauge ranks the competitiveness of financial centers around the world based on a comprehensive valuation system that combines objective indicators and surveys;
- Executed an agreement with LSP Partners LLC, a risk management research consulting firm, to develop and co-brand an index family utilizing a proprietary strategy created by LSP Partners founder and CEO, Ralph Vince. The Leverage Space Portfolio (LSP) strategy employs an equity-based risk-control process focused on capital preservation and drawdown management; and
- Executed an agreement with Pring Research, to develop and co-brand a U.S. business-cycle index designed to closely track Pring Research’s proprietary investment strategy that seeks to identify the current stage of the economic business cycle.
Other highlights
- in October, Dow Jones Indexes unveiled Indexology, a blog to help investors understand how indexes can be used to describe and evaluate market performance; and
- in an effort to continue asserting its thought-leadership role in the marketplace, Dow Jones Indexes hosted press events including its annual Global Economic Outlook (January), Commodity Review & Outlook (July) and Holiday Season Retail Outlook Call (November).
