Asia Index Private Limited to launch S&P BSE AllCap Index Family

In response to the market need for a broad benchmark index that will help measure the performance of the Indian equity market, Asia Index Private Limited, a joint-venture between S&P Dow Jones Indices and BSE, will launch the S&P BSE AllCap Index Family in the second quarter of 2015. The S&P BSE AllCap Index will further be divided into five size-based indices including LargeCap, MidCap and SmallCap using total market capitalisation and ten sector-based sub-indices. Certain existing indices will be replaced by the new indices.

The S&P BSE All Cap Index is a broad index covering more than 95% of the total market capitalisation and comprises more than 700 stocks that are listed on the BSE. The S&P BSE AllCap Index will be useful for broad market measurement, while the five size-based indices and ten sector indices will offer investors a tool to analyse market movements across size or sectors. The family of indices is designed to be comprehensive, modular and rules based.

"The Indian equity market has been one of the top performers among emerging economies. Hence, there is a strong need to effectively measure its performance across sectors and market segments that can truly represent its breadth and depth," says Alka Banerjee, CEO, Asia Index Private Limited.

The size-based indices' stock selection conforms to S&P Dow Jones Indices' global methodology of 70%/15%/15% composition in large-, mid- and small-cap; while the sector indices are as per the 10 broad economic sectors as identified by BSE. All 16 indices will be calculated in Indian Rupees (INR) and also in United States Dollars (USD), helping foreign investors to measure market performance after incorporating exchange rate (INR/USD) movements.

"We are excited to launch the entire suite of indices under the S&P BSE AllCap Index. Investors in India, and globally alike, want a diversified way of measuring market movements which has a wider coverage of companies that is in line with global practices," says Ashish Chauhan, MD & CEO, BSE.

In addition to the S&P BSE AllCap Index, the following are the five size indices to be launched:

- S&P BSE LargeCap
- S&P BSE MidCap
- S&P BSE Large MidCap
- S&P BSE SmallCap
- S&P BSE MidSmallCap

The ten sector indices to be launched are:

- S&P BSE Basic Materials
- S&P BSE Consumer Discretionary Goods & Services
- S&P BSE Energy
- S&P BSE Finance
- S&P BSE Fast Moving Consumer Goods
- S&P BSE Healthcare
- S&P BSE Industrials
- S&P BSE Information Technology
- S&P BSE Telecom
- S&P BSE Utilities

The existing S&P BSE MID CAP, S&P BSE SMALL CAP, S&P BSE HEALTHCARE, S&P BSE IT and S&P BSE FMCG indices will be replaced with new indices, namely S&P BSE MidCap, S&P BSE SmallCap, S&P BSE Healthcare, S&P BSE Information Technology and S&P BSE Fast Moving Consumer Goods, respectively. The new indices will provide a better representation of these industries with respect to size and sector.

Source : Equity Bulls

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