Nasdaq Rolls Out Global Equity Index Suite

 ... (Photo credit: marsmet462)

New York, Dec.10, stock investment .- Nasdaq OMX, the company behind the Nasdaq electronic stock exchange, continued its push into the world of indexing with the rollout of the first piece of a comprehensive global family of equity indexes that will ultimately canvass 98 percent of the investable universe and cover 9,000 securities with a combined float-adjusted market capitalization of $32 trillion. Today’s rollout covers about 4,000 indexes calculated in dollars, and the remaining indexes that will be organized around different currencies will be introduced in different phases at unspecified future dates, Nasdaq said in a press release.

The index family will ultimately result in the development of 24,000 separate indexes, Nasdaq said. That number of indexes, at first blush, may seem absurdly large, but really reflects the potential combinations that are now tangibly at investors’ disposal, whatever their aims. Moreover, other index providers have similarly large numbers of indexes in their index families for exactly the same reason.

“The NASDAQ Global Index Family offers institutional and retail investors, asset managers, traders and other market participants a broad representation of the global investable equity marketplace through efficient access and pricing,” John Jacobs, Nasdaq OMX’s executive vice president, said in the release.

Nasdaq aims to increase its footprint in the increasingly competitive world of indexing. The launch of the Global Index Family and its plan announced in October to acquire the indexing business of Mergent Inc., which includes the popular “Dividend Achievers” franchise of payout-focused indexes, make clear that it will build that indexing presence through acquisitions as well as internal expansion.

The rapid growth in importance and popularity of the exchange-traded funds explains much of the action in the indexing industry. Total U.S.-listed ETF assets—including ETNs—is now $1.316 trillion, with more than 99 percent of that amount in indexing strategies. Innovations in indexing are even quasi-active these days, raising the question of how much actively managed ETFs will ever gain market share.

Moreover, Nasdaq, as an exchange, finds itself at the center of the ETF revolution. On any given day, ETF trading volume by dollar value makes up a third of all volume on U.S. exchanges, and that total jumps to around 40 percent on days of heightened volatility, according to numbers we crunched here at IndexUniverse.

The new index family covers 45 countries classified as developed and emerging markets across the following regions: the Americas, Europe, Asia-Pacific and Middle East-Africa.

Like all Nasdaq OMX indexes, the Nasdaq Global Index Family is based on a transparent, rules-based index methodology.

More than 10 years of historical backtested data are available for the entire global family, and price, total return and net total return versions are calculated for each index, the company said.... 

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