STOXX Ltd, a provider of innovative, tradable and global index concepts, and the operator of Deutsche Borse Group’s index business, has announced that the newly launched iSTOXX FactSet Thematic Indices which capture megatrends in investing have been licensed to iShares to underlie four exchange-traded funds (ETFs).
iShares is a leading provider of ETFs and is owned by BlackRock.
The iSTOXX FactSet Thematic Indices are comprised of companies from selected countries that are exposed to a defined set of themes including Ageing Population, Automation & Robotics, Digitalization and Breakthrough Healthcare.
Matteo Andreetto, CEO of STOXX, said: “Research shows that the four disruptive megatrends captured by the iSTOXX FactSet Thematic Indices will play a major role in the transition towards a digital, highly technological world that seeks to find alternatives to current healthcare approaches and effective solutions related to an increasing life expectancy.”
The index universe for the iSTOXX FactSet Thematic Indices is defined as stocks within the STOXX Global Total Market Index that are classified as belonging to a defined set of developed and emerging countries.
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To be eligible for inclusion, the companies have to derive more than 50 percent of their most recent total annual revenues from business activities linked to the themes outlined.
Additionally, the companies’ 3-month average daily trading volume (ADTV) has to be greater than one million euros and the free-float market capitalization greater than 200 million euro.
Tom Fekete, head of product for iShares EMEA at BlackRock, added: “The iSTOXX FactSet Thematic Indices look to capture the opportunities created by long-term structural trends. They use highly detailed revenue analysis to identify the companies most aligned to these trends. Ultimately, these ETFs are a new set of investment tools that investors can use to express their views on these themes, in a transparent, global and cost-efficient way.”
Partnership with FactSet Revere
To identify eligible firms and ensure they derive 50 percent or more of their revenues from the themes defined above, STOXX has partnered with FactSet Revere, a leading taxonomy expert, to use the FactSet Revere Business Industry Classification System (FactSet RBICS).
Each iSTOXX FactSet Thematic Index is aimed at having a minimum number of 80 constituents at each review. If the screening process results in being too restrictive for an index, the revenue filter is progressively lowered in steps of 5 percent for that particular index, until the number of constituents is equal to, or greater than 80.
The iSTOXX FactSet Thematic Indices are equal-weighted, calculated in price, net return and gross return versions and are available in euros and US dollars. The base date is 20 June, 2011 with the base value set at 1,000.
The indices are reviewed on an annual basis in June.