Index providers Dow Jones Indexes and its European partner Stoxx have licensed the newly-launched Dow Jones Luxury Index and the existing Dow Jones Stoxx 600 Index to BNP Paribas to serve
Index providers Dow Jones Indexes and its European partner Stoxx have licensed the newly-launched Dow Jones Luxury Index and the existing Dow Jones Stoxx 600 Index to BNP Paribas to serve as the basis for two exchange-traded funds listed on the Euronext Paris stock exchange.
The Dow Jones Luxury Index is a new index designed to measure the market performance of companies worldwide that derive a sizeable portion of revenues from providing luxury goods and services.
The Dow Jones Stoxx 600 Index aims to provide a broad yet liquid representation of large-, mid- and small-capitalisation companies in Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Luxembourg, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland and the UK.
‘The Dow Jones Stoxx 600 Index provides investors with exposure to core European markets and is a natural complement to BNP Paribas’s line-up of ETFs based on the Dow Jones Stoxx indices,’ says Werner Bürki, chairman of the Stoxx supervisory board. ‘The Dow Jones Luxury Index allows market participants to tap into a niche sector with tremendous growth potential.’
The Luxury Index tracks the performance of 30 companies selected by editors of The Wall Street Journal to reflect a diversified cross-section of the luxury segment across countries, sectors and market capitalisation.
The index is weighted by float-adjusted market capitalisation and component stock weights are capped at 10 per cent of the index. Composition changes to the index are made on an as-needed basis, while share numbers and float adjustment factors are updated quarterly.
In backtesting to January 2 this year, the Luxury Index was up 6.71 per cent on June 20. Its top three components are Compagnie Financière Richemont, LVMH Moet Hennessy Louis Vuitton and Porsche Automobil Holding. The Dow Jones Stoxx 600 Index is up 9.73 per cent over the same time period.
Best known for the Dow Jones Industrial Average, Dow Jones Indexes is also co-owner of the Dow Jones Stoxx indices (it owns Stoxx in partnership with Deutsche Börse and SWX Swiss Exchange) and together with Wilshire Associates it provides the Dow Jones Wilshire Global Index family, which is anchored by the Dow Jones Wilshire 5000 and covers more than 12,000 securities in 61 markets. Dow Jones Indexes also maintains various alternative indices, including measures of the hedge fund and commodity markets.