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For non-market factors – 4 indices launched by Asia Index

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The Asia Index Private Ltd, a JV between S&P Dow Jones Indices and BSE has launched 4 new indices as part of its attempt to enable investors to invest based on parameters like valuation and volatility.

  • Each of the four indices includes the top 30 companies, which are selected based on their respective factor scores in accordance with the index methodology.
  • The indices are drawn from the constituents of the S&P BSE LargeMidCap index (sub-index of the S&P BSE AllCap index).

The four new indices launched under the umbrella of S&P BSE Factor Indices are:

  • S&P BSE Enhanced Value Index
  • S&P BSE Low Volatility Index
  • S&P BSE Momentum Index
  • S&P BSE Quality Index

For non-market factors - 4 indices launched by Asia IndexThe S&P BSE Factor Indices are designed to include non-market factors such as value, momentum, quality and low volatility using a transparent and rules-based methodology while ensuring reasonable liquidity.

How these indices will work?

  • S&P BSE Enhanced Value Index – It is designed to measure the performance of companies with valuations based on ratios like book value-to-price, earnings-to-price and sales-to-price
  • S&P BSE Low Volatility Index – It comprises companies with the least amount of volatility.
  • S&P BSE Momentum Index – It is designed to measure the performance of those companies that exhibit persistence in their relative performance.
  • S&P BSE Quality Index – It will track high-quality stocks based on returns on equity, accruals ratio and financial leverage ratio.

These indices will be reviewed once in six months.