Our indices follow a common set of rules in order to make the indices fully transparent, but also fully investable by reducing uncertainty and thus operationnal and market risks associated with ordinary and exceptionnal events.
The Equity Indices are indices designed to reflect the performance of a basket of equities; such indices are always managed in a three layer manner:
The first layer is the selection layer, where potential index members are screened for relevance in entering the Index.
The second layer is the allocation layer, where index members are weighted according either to their market value with free float and capping adjustments, or are weighted according to a fundamental scoring.
The third layer is the calculation in itself: weights and adjustments are transformed into a number of shares; index level is computed using a classical Laspeyres framework; ongoing maintenance is performed on a daily basis by our Index Calculation Agents using the rules set out in the methodology.
Version 1.0 of the methodology introduced the common management rules of Equity Indices;
Version 1.1 made clearer how some specific cases of rights distributions impact the Index;
Version 1.2 introduced a two stage rebalancing process, where the number of shares are determined ahead of the rebalancing date, and Index Divisor is adjusted for continuity on the rebalancing date.
Version 1.3 extended possible underlying classes to assets such as Indices, Funds and Interest Rates as well as adding definitions to Closing Price determination.
*Subject to the individual Index Rules governing the indices