S&P Emerging Markets Domestic Demand Index launched
S&P Dow Jones Indices has launched the S&P Emerging Markets Domestic Demand Index, which is designed to measure the performance of companies that capture a major engine of growth within the emerging markets – domestic demand.
To qualify for membership in the S&P Emerging Markets Domestic Demand Index, a stock must be a publicly traded company domiciled and incorporated in the following emerging market countries: Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Thailand, or Turkey, and be listed on the primary stock exchange of its respective country.
The index consists of common stocks listed on the primary exchanges of emerging markets, ADRs listed on US exchanges, and GDRs listed on European exchanges. Constituents consist of 50 emerging market securities from the following sectors as classified according to the Global Industry Classification Standard (GICS): consumer staples, consumer discretionary, telecommunication services, healthcare, and utilities.
“The S&P Emerging Markets Domestic Demand Index consists of companies whose performance is tied to the domestic demand in their respective market,” says Vinit Srivastava, senior director at S&P Dow Jones Indices. “As most emerging market benchmarks do not capture this major engine of growth, the S&P Emerging Markets Domestic Demand Index will fill a considerable void for a representative benchmark in this space.”
The index uses a modified market capitalisation weighting scheme. Index composition is reviewed annually in September. At each September rebalancing, a company in the qualifying universe is added to the Index if it meets the following requirements: float-adjusted market capitalisation of at least USD100m as of the September rebalancing reference date, average daily turnover of at least USD8m for the six months prior to the September rebalancing reference date, and has traded at least 90 per cent of the total trading days in the six months leading up to the September rebalancing reference date.
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