The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.

All to play for

Monetary union’s effect on European investment patterns is giving rise to a host of new benchmarks. In both equities and bonds, index providers are scrambling for continental superiority. New providers can win market share quickly but the established names are fighting back.

       
Rafey Sayood

By its very nature, index investing is a relatively effortless way to manage institutional money. All a fund manager need do is pile assets into a basket of securities that replicates the relevant yardstick, sit back and let the markets do the rest.


For the majority of active investors, index benchmarks provide the foundation for portfolio construction. The fraction of assets diverted away from market-neutral positions determines whether a fund outperforms or underperforms.


And for the providers of the indices against which performance is measured, calculating prices and disseminating data are the twin keys to establishing market dominance. Often this opens up more lucrative relationships with users - based either on license fees for information and analytics or via revenues from transactions services, portfolio investment advice and wholesale portfolio rebalancing.


Indexing is traditionally a fairly straightforward exercise - even if the methodology used to create and maintain an index can be extraordinarily complicated.




You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree