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Standard & Poor’s launches Asia Property 40 Index

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Standard & Poor’s has announced the launch of the S&P Asia Property 40 index, which will provide liquid exposure to leading publicly-listed companies in the Asian property and real

Standard & Poor’s has announced the launch of the S&P Asia Property 40 index, which will provide liquid exposure to leading publicly-listed companies in the Asian property and real estate markets.

The S&P Asia Property 40 Index comprises 40 leading listed Asian property companies that meet size, liquidity and local listing requirements, with no single market having more than 15 stocks in the index or representing more than 40 per cent of the index. It is designed for use by banks and asset management companies to create retail investment products.

The index, which seeks to provide investors with diversified, investible exposure to the Asian property market, is a subset of the S&P/Citigroup Global Property Index, which is comprised of more than 400 stocks from the S&P/Citigroup Broad Market Index.

‘We have observed a growing trend in Asia in the securitisation of real estate assets through the public equity markets, as well as the public listing of property management firms,’ says Standard & Poor’s Index Services vice-president Tim Eisenhauer.

‘This presents an opportunity for the region’s investors to diversify their own holdings beyond conventional stocks and bonds, and for foreign investors to gain exposure to the long-term growth of the Asian property markets.

‘Standard & Poor’s has launched the S&P Asia Property 40 index because there is currently no tradable index that provides investors efficient access to this Asian asset class.’

The top 10 index components by market capitalisation are Mitsubishi Estate, Swire Pacific, Sun Hung Kai Properties, Mitsui Fudosan, Cheung Kong (Holdings), CapitaLand, Country Garden Holdings, Sumitomo Realty & Development, Guangzhou R&F Properties and Hang Lung Properties.

The S&P Asia Property 40 Index employs a modified market capitalisation-weighting scheme, and is rebalanced after the close of business on the third Friday of November each year. Stocks must have a total market capitalisation above USD1bn and a three-month average daily value traded above the liquidity threshold of USD3m.

All stocks in the selection universe are classified according to country of domicile, with China and Hong Kong being treated as separate jurisdictions. Each stock’s domicile must be an Asian country and its primary market listing must be on a regulated Asian stock exchange.

Standard & Poor’s Index Services maintains a wide variety of investible and benchmark indices including the S&P 500, an index with USD1.32trn invested and USD4.91trn benchmarked, and the S&P Global 1200, a composite index made up of seven regional and country headline indices.

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