The Tel Aviv Stock Exchange (TASE) and BlueStar Indexes has launched the TASE-BlueStar Israel Global Technology Index (TA-BIGITech).
TA-BIGITech is the first and only benchmark tracking a broad, deep and complete universe of major Israeli technology companies trading on markets worldwide. It includes 57 stocks of Israeli or Israel-related high-tech companies and will serve as the underlying benchmark for index funds, ETFs and ETNs.
“There’s a reason Israel is globally known as the ‘Start-up Nation’ for the country has more start-ups per capita than any other nation in the world, ranking just behind Silicon Valley for the largest number of start-ups and innovative companies,” says Steven Schoenfeld, Founder and Chief Investment Officer of BlueStar Indexes.
Given the global nature of Israel’s economy, Israeli technology companies have increasingly chosen to list their stocks on global exchanges, particularly NYSE, Nasdaq and the London Stock Exchange. TA-BIGITech is a modified market cap-weighted index that allows inclusion of Israeli companies regardless of which stock exchange a company’s shares are listed on.
Innovative technology firms have largely driven global growth during this decade, and the weight of tech companies in major stock indexes around the world has significantly increased. Given Israel’s low weight in global indexes, however, Israel’s cutting-edge companies are often overlooked among technology investors’ portfolios. Israeli tech stocks are a key missing component of global technology equity exposure.
The aggregate market cap of the companies included in TA-BIGITech is approximately USD75 billion, compared to less than USD25 billion for current Israeli Tech benchmarks like the TA-TechElite. In addition, there is minimal overlap between TA-BIGITech and technology indexes and ETFs currently listed in the US.
TA-BIGITech provides ‘broad, deep and complete’ exposure to the full range of Israeli technology including InfoTech, AgriTech, DefenseTech, CleanTech and BioTech. Leading Israeli companies in the index include CheckPoint, Amdocs, Stratasys, Nice, Mobileye, and Mellanox.
“Israel is a dominant leader in high-tech. We are actively promoting this industry and encouraging international investors to invest broadly in Israeli companies,” says Yossi Beinart, CEO of the Tel Aviv Stock Exchange.
“This new index is particularly important as it provides convenient access for global investors around the world to Israeli high-tech companies trading on various exchanges. We expect that TA-BIGITech and ETNs that will track the index will enhance the growth of Israeli high-tech companies and further expose TASE and the companies traded on TASE to overseas investors, thereby contributing to the growth of the entire market.”
“We are thrilled to be involved in the evolution of BIGITech to TA-BIGITech which we believe facilitates the exposure of investors to global Israeli high-tech companies, giving them the benefit of their innovation across a range of cutting-edge technologies,” says Kris Monaco, Head of ISE ETF Ventures, a partner of BlueStar in maintaining and commercialising its indexes.
TA-BIGITech is based on BlueStar Indexes’ proprietary methodology for country classification. It uses an enhanced version of the index methodology in place since BIGITech’s initial launch in 2013, and has history from December 2003. TA-BIGITech is already licensed to KSM/Excellence, Israel’s largest index/Exchange Traded Note sponsor, and BlueStar plans to expand licensing in both the US and around the world in the coming months.
The Israeli economy is forecast to grow 3.1% in 2015, the second-highest developed market growth rate this year after the US, and Israel’s robust technology sector is expected to account for at least one-third of this growth.
