ING Teams Up with Bloomberg to Launch New Emerging Markets FX Indices

The new indices will feature a basket of 12 equally weighted EM currencies vs the USD.

Dutch banking giant ING has teamed up with Bloomberg to jointly unveil a new global emerging markets offering. The group will be launching a new series of proprietary global emerging markets indices, offering improved access to emerging markets currencies.

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The product launch comes amidst a global increase in demand for emerging markets (EM) trading, which has seen a steady rise in 2017. While seen as a laggard last year, many EM stock indices have reversed course in 2017, with many exchanges and currencies netting recent highs. Additionally, the erosion of the USD has paved the way for more EM currencies, many of which are now attracting attention in portfolios.

Indeed, the USD is trading at a multi-year low against many currencies, also helping to breathe volatility into an otherwise historically sleepy summer market. As one of the industry’s foremost global index providers, ING selected the group for the administration of its freshly launched indices. More specifically, this will see Bloomberg tasked with the independent calculation and maintenance of these EM indices.

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New exposure

The new accord will also see ING tap Bloomberg for strategy index development and calculation, drawing up Bloomberg’s BFIX data source to use in the index – BFIX constitutes a Time-Weighted Average Price (TWAP) for its myriad currency fixings. As an independent benchmark for currency rates, this feature will help strengthen any transparency measures necessitated on the indices.

The launch is important as the joint Bloomberg ING Global Emerging Markets index offering will facilitate more exposure for these currencies against the USD. This will include a diverse basket of 12 equally weighted EM currencies, complete with volatility-based risk parameters.

Guy Thomas

Guy Thomas, Head of FX Rates and Credit Trading at ING, commented: “We are pleased to offer the Bloomberg ING Global Emerging Markets FX Indices to our clients as it allows them to take exposure to the emerging markets currency asset class in a cost effective, efficient and transparent way.”

“We are delighted to support ING UK in launching these emerging markets FX indices. As regulations evolve and investors increasingly demand more benchmark transparency, we are helping firms across the globe turn their investment strategies into indices, and offering outsourcing of in-house index calculation and administration to our managed platform,” added Ji Zhuang, Head of Custom Strategies business at Bloomberg.

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