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DJ licenses Dow Jones Select Dividend 15 Index to UBS for structured product


Dow Jones Indexes has licensed the new Dow Jones Switzerland Select Dividend 15 Index to UBS to serve as the basis for a structured product, Open End PERLES, which has listed on the SIX Swiss Exchange.

The Dow Jones Switzerland Select Dividend 15 Index is designed to measure the stock performance of high dividend-paying companies in Switzerland, and to be used as the basis for financial products in Switzerland and other European markets.

Dow Jones Indexes has been a leader in dividend indexing since its 2003 launch of the Dow Jones US Select Dividend Index. Earlier in 2011, Dow Jones Indexes unveiled Europe and Eurozone dividend indexes, as well as distributing versions of its dividend indexes for Europe, Eurozone, Germany and France.

“Under the current market conditions, we’ve noticed an increasing interest for dividend-based indexes,” says Michael A. Petronella (pictured), President, Dow Jones Indexes. “Our new gauge goes beyond merely basing stock selection on dividend yield. We’ve integrated other critical indicators of dividend quality and company health into this index’s methodology.”

The Dow Jones Switzerland Select Dividend 15 Index is the latest launch in a significant expansion of Dow Jones Indexes’ suite of European offerings, underscoring the global index provider’s revitalised commitment to the region. For Europe in 2011, Dow Jones Indexes has unveiled a European version of the Dow Jones Industrial Average, The Europe Dow; six dividend-focused and two real estate indexes; two volatility-control index series; and two blue-chip indexes.

The index universe for the new index is defined as all components of the Dow Jones Switzerland Index that pass the eligibility screens for dividend history, quality and liquidity. One of the criteria for the stock selection is a three-month average daily trading volume of more than USD 3 million. The top 15 stocks are then selected based on dividend yield, three-year dividend growth, three-year earnings-per-share growth and return on equity.

The index composition is reviewed annually in December. Component weightings are assigned based on dividend yield. The weights of individual securities are capped at 15% within the index.

As of September 30, 2011, the components of the index are: Zurich Financial Services AG, Roche Holding AG Part Cert., Swisscom AG, Banque Cantonale Vaudoise, Kaba Holding AG, Baloise Holding AG, Credit Suisse Group, Novartis AG, Nestle S.A., Partners Group Holding AG, Geberit AG, Syngenta AG, Sika AG, Schindler Holding AG Part.Cert., Galenica AG.

Calculation of the Dow Jones Switzerland Select Dividend 15 Index began on 27 October, 2011. Real index history is available daily from this date forward. Back-tested historical data have been calculated daily back to 31 December, 2006, the date at which the index value is set at 1000. Price return and total return versions of the index are available.

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