Sign up for free newsletter


Dow Jones Indexes and AIG launch new family of single commodity indexes

Dow Jones Indexes and AIG Financial Products are expanding the Dow Jones-AIG Commodity Index family by creating 20 new single-commodity sub-indexes.

Each of the new sub-indexes, consisting of a single commodity, is constructed according to the rules of the DJ-AIGCI. There is one sub-index for each of the 19 commodities currently included in the DJ-AIGCI plus a sub-index for cocoa, which was an Index component until 2005. The 19 commodities currently included in the DJ-AIGCI are aluminium, coffee, copper, corn, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, nickel, silver, soybeans, soybean oil, sugar, unleaded gasoline, wheat, and zinc.

Total return versions of each of the new sub-indexes, which join 25 other DJ-AIGCI-related indexes and sub-indexes already calculated daily by Dow Jones Indexes and AIG, are also available. The expansion of the Index family responds to the rapid growth of interest in commodities as an asset class.

Investors are demanding increasingly sophisticated tools to manage their commodity investment as they develop specialized views on specific commodities. These new sub-indexes provide investors with a benchmark for those markets. For example, those investors who invest in sugar or corn in light of the increased use of these commodities in ethanol production can now use the Dow Jones-AIG Sugar Sub-IndexSM and the Dow Jones-AIG Corn Sub-IndexSM as a benchmark for those investments.

Investors are also increasingly sensitive to the details of index construction as they can impact commodity index returns, and the new sub-indexes are constructed according to the rules of the DJ-AIGCI.

"The rapid growth of this asset class in recent years has been nothing short of remarkable,' says Michael A Petronella, president of Dow Jones Indexes/Ventures. 'As investor demand for greater flexibility to manage commodity index-based investment has grown, we have responded with new and efficient vehicles to investors seeking tools to measure their exposure to individual commodity futures markets."

Joseph Cassano, president of AIG-FP adds: "With approximately USD 24 billion in assets tracking the Dow Jones-AIG Commodity Index on a global basis, we think it's important that commodity investors also have an increased capability to customize their exposure to specific commodities using a benchmark with the credibility of the DJ-AIGCI. While broad commodity indexes remain the best way for many investors to access the asset class from a strategic perspective, other investors may seek to adjust exposure to certain commodities on a more tactical basis."

Background notes:
Launched in1998, the Dow Jones-AIG Commodity Index is a diversified and highly liquid benchmark for the commodities markets, composed of futures contracts on physical commodities.

For further information and related articles on Structured Products, please click here

5 days 23 hours from now - Hong Kong
6 days 23 hours from now - Toronto
1 week 1 day from now - Shanghai
Sun, 09/04/2017   - Dubai
Mon, 15/05/2017   - London
Mon, 15/05/2017   - London
IKONIC Fund Services Ltd.
Tue, 29/11/2016 - 12:28
Backstop Solutions Group
Tue, 08/11/2016 - 18:44
The Gemini Companies
Mon, 17/10/2016 - 12:51
other gfm publications