S&P Dow Jones Indices (S&P DJI) has launched the S&P Europe 350 Economic Cycle Factor Rotator Index, which applies a rotational strategy and tracks pivotal changes in business and economic cycles.
The index is the latest addition to a series of innovative Rotator Indices that have recently been introduced in key international markets. The Indices have been exclusively licensed to JP Morgan.
“We are pleased to tailor this unique factor-based index for the European market following earlier launches in Asia and the United States. The growing demand for these rotator indices reflect investors’ appetite for index-based solutions that can adjust to major business and economic moves,” says Vinit Srivastava, Managing Director, Strategy and Volatility Indices at S&P Dow Jones Indices.
“The S&P Europe 350 Economic Cycle Factor Rotator Index is an efficient way of gaining exposure to the European Equity market, by building upon sound academic & traditional global equity factors, to deliver compelling historical outperformance versus traditional European market-cap weighted indices,” says Arnaud Jobert (pictured), Head of EMEA Equities Structuring and Co-Head Global Cross-Asset Investible Indices at JP Morgan.
This Europe-focussed index rotates across distinct investment strategies such as equity-only, long/short, and risk control which combines exposures to futures and cash bonds. The index utilises the most recent economic data from the Organisation for Economic Cooperation and Development’s (OECD) Europe Composite Leading Indicator. The weight of each sub-index is determined by an economic indicator applicable to each underlying index’s region and is calculated on a daily risk control basis with a target volatility of 6 per cent.