Dow Jones expands Russia index for ETF use
Dow Jones Indexes has increased the number of components in the Russia GDR Index to 17 for use in the Lyxor ETF Russia exchange-traded fund
The new version of Dow Jones Indexes’ Russia GDR Index, which measures the performance of the leading Russian Depository Receipts traded on the London Stock Exchange (LSE), will serve as the basis for Lyxor’s ETF Russia exchange-traded fund (ETF), as of today (March 20).
Previously, Lyxor, the ETF subsidiary of Société Générale, had used the Dow Jones Titans 10 index as the basis for its Russia ETF. The ETF was based exclusively on equities from Russian companies listed in Europe, representing assets under management of €1.1 billion as of March 14. The Titans 10 index has 10 fixed components whereas the new index has more than 17 fixed component and non-component securities.
“The number of components is not fixed,” says Deborah Ciervo, senior director at Dow Jones Indexes in New York. “It gives a broader exposure to the underlying market-place and a more diversified investment based in Russia.”
In addition to offering investors broader exposure to the Russian market – covering roughly 77% more of the wider market than the current Russia GDR benchmark – the new index also offers investors more flexibility in reacting to market changes.
“The new index combines both broad market coverage and liquidity, which are important elements when creating an ETF,” says Nizam Hamid, head of ETF strategy and deputy head of ETFs Europe at Lyxor in London. “We look forward to continuing the success that Lyxor ETFs have had using a Dow Jones index to cover Russian equities.”