STOXX and RiskFirst to Launch LDI Indices

  • Partnership combines STOXX’s approach to providing innovative indices with RiskFirst’s market leading position in the defined benefit pensions analytics market
  • Index family provides a new solution to the challenges of a £1 trillion market by providing independent benchmarks for liability-driven investments (LDI)

LONDON & ZURICH--()--STOXX Ltd., the operator of Deutsche Börse Group’s index business and a global provider of innovative and tradable index concepts, announced today the launch of the new iSTOXX RiskFirst LDI index family as of 23 April 2018. This new offering has been jointly developed with RiskFirst, the UK’s leading provider of risk analytics and reporting solutions to the defined benefit pensions market. STOXX will calculate a range of indices based on 12 profiles, capturing member type, duration, type of indexation (pre- and post-retirement), interest rate and inflation sensitivity and tax-free cash component of typical UK pension schemes. The indices combine STOXX’s real-time fixed-income index calculation capabilities with a unique set of data provided by RiskFirst.

Matthew Seymour, CEO of RiskFirst, commented: “The set of indices we have developed in partnership with STOXX are a major leap forward, providing improved governance and increased accuracy in a cost-efficient solution. PFaroe is rapidly becoming an industry standard for the modelling of pension plans and therefore offers us unique insight into the behaviour of pension plan cash flow profiles at a very granular level. When combined with STOXX’s extensive experience in designing innovative and objective investment benchmarks, the result is a set of indices that deliver great value to UK pension plans.”

“With our new LDI index offering we are addressing the challenges of a £1 trillion market by providing independent benchmarks for liability-driven investments. Our LDI indices will support pension scheme trustees and consultants in their efforts to select, monitor and challenge LDI managers. This is further proof of our innovative approach to tackle market inefficiencies with transparent investment tools,” said Matteo Andreetto, CEO of STOXX.

The iSTOXX RiskFirst LDI indices track the performance of corporate and government bonds denominated in GBP. They function as flexible, investable building blocks for LDI portfolios. Four different sets of indices are provided: nominal bond indices, inflation-linked bond indices, blended indices and non-gilt indices. The indices are constructed using a proprietary cash flow matching model that incorporates best-in-class LDI techniques. Certain key features of LDI portfolio construction, such as rebalancing between real and nominal exposure, are embedded in the index family. The indices are rebalanced quarterly.

Note to Editors:

About STOXX Limited

STOXX Ltd. is a global index provider, currently calculating a global, comprehensive index family of over 7,500 strictly rules-based and transparent indices. Best known for the leading European equity indices EURO STOXX 50, STOXX Europe 50 and STOXX Europe 600, STOXX Ltd. maintains and calculates the STOXX Global index family which consists of total market, broad and blue-chip indices for the regions Americas, Europe, Asia/Pacific and sub-regions Latin America and BRIC (Brazil, Russia, India and China) as well as global markets.

To provide market participants with optimal transparency, STOXX indices are classified into four categories. Regular “STOXX” indices include all standard, theme and strategy indices that are part of STOXX’s integrated index family and follow a strict rules-based methodology. The “iSTOXX” brand typically comprises less standardized index concepts that are not integrated in the STOXX Global index family, but are nevertheless strictly rules-based. While indices that are branded “STOXX” and “iSTOXX” are developed by STOXX for a broad range of market participants, the “STOXX Customized” brand covers indices that are specifically developed for clients and do not carry the STOXX brand in the index name. Under the Omnient brand, STOXX offers custom indices from its existing index universe.

STOXX indices are licensed to more than 600 companies around the world as underlyings for Exchange Traded Funds (ETFs), futures and options, structured products and passively managed investment funds. Three of the top ETFs in Europe and approximately 25% of all assets under management are based on STOXX indices. STOXX Ltd. holds Europe's number one and the world's number two position in the derivatives segment.

STOXX is part of Deutsche Boerse Group, and also calculates, disseminates and markets the DAX indices. www.stoxx.com

About RiskFirst

RiskFirst is a financial technology company providing modern technology solutions to Asset Owners, Consultants and Asset Managers to help grow and improve their businesses. Their first product, PFaroe, was launched in 2009 to deliver a modern and effective software solution for institutional investors to manage their asset and liability risk. PFaroe is now the market leader in the UK – reaching more than half of the UK DB market - with a growing foothold in the US. Overall, more than 1,800 pension plans, with over $750 billion of assets, now benefit from our technology.

For more information please go to www.riskfirst.com.

STOXX, Deutsche Boerse Group and their licensors, research partners or data providers do not make any warranties or representations, express or implied, with respect to the timeliness, sequence, accuracy, completeness, currentness, merchantability, quality or fitness for any particular purpose of its index data and exclude any liability in connection therewith. STOXX, Deutsche Boerse Group and their licensors, research partners or data providers are not providing investment advice through the publication of indices or in connection therewith. In particular, the inclusion of a company in an index, its weighting, or the exclusion of a company from an index, does not in any way reflect an opinion of STOXX, Deutsche Boerse Group or their licensors, research partners or data providers on the merits of that company. Financial instruments based on the STOXX® indices, DAX® indices or on any other indices supported by STOXX are in no way sponsored, endorsed, sold or promoted by STOXX, Deutsche Boerse Group or their licensors, research partners or data providers.

Contacts

STOXX
Heiner Seidel
Phone: +49 69 211 11 500
media-relations@deutsche-boerse.com
or
RiskFirst
Thomas Morris
+44 207 377 49 98
thomas.morris@moorgategroup.com

Contacts

STOXX
Heiner Seidel
Phone: +49 69 211 11 500
media-relations@deutsche-boerse.com
or
RiskFirst
Thomas Morris
+44 207 377 49 98
thomas.morris@moorgategroup.com