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Stoxx and Dax Strategy Indices licensed to RBS

Monthly Leverage and Short indices to underlie exchange-traded funds ..

 


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STOXX Limited announced that the EURO STOXX 50 Monthly Leverage and EURO STOXX 50 Monthly Double Short indices, and the LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices have been licensed to RBS Global Banking & Markets to serve as an underlying for four new exchange-traded funds.

The RBS MARKET ACCESS Euro Stoxx 50(r) Monthly Leverage Index ETF, RBS MARKET ACCESS Euro Stoxx 50(r) Monthly Double Short Index ETF, RBS MARKET ACCESS LevDAX(r) X2 Monthly Index ETF, RBS MARKET ACCESS ShortDAX(r) X2 Monthly Index ETF will be available on Deutsche Boerse’s trading platform Xetra today. It is the first time that these four indices are being used as the basis for an ETF.

“The EURO STOXX 50 Monthly Leverage and Monthly Double Short indices, and LevDAX and ShortDAX x2 monthly indices offer market participants a way to bypass daily market fluctuations and to take a more long-term approach on bullish and bearish sentiments on European and German equities,” said Hartmut Graf, chief executive officer, STOXX Limited. “We are happy to have licensed these indices to RBS, as this is the first time that they will be used as underlying for ETFs.”

“RBS is proud to introduce long and short monthly leveraged index funds to the European market for the first time,” David Moroney, RBS global head of structured funds said. “Prior to this, only ETFs with daily leveraged indices were available in Europe. Thanks to monthly rebalancing, investors will now have access to a leveraged performance that is consistent for longer than one day.”
The EURO STOXX 50 Monthly Leverage Index is linked to the monthly performance of the EURO STOXX 50 Net Return Index – measured as of the third Friday of the month – in a leveraged way: A positive performance of the EURO STOXX 50 Index results in twice the positive performance of the EURO STOXX 50 Monthly Leverage Index, and vice versa. The EURO STOXX 50 Monthly Double Short Index replicates a short investment strategy that is inversely linked to the monthly performance of the EURO STOXX 50 Gross Return Index, also as of the third Friday of the month. A negative performance of the blue-chip index results in a positive change of twice the performance the EURO STOXX 50 Monthly Double Short Index, and vice versa.

The LevDAX x2 (monthly) also rises and falls twice as much as the performance of the DAX index, thus providing an effective and innovative strategy for magnifying participation in market movements. The leverage factor is adjusted on a monthly basis to ensure that LevDAX x2 (monthly) always achieves twice the performance of the underlying index based on the closing level on the third Friday of the previous month. However, if an investment is made between the monthly adjustment dates the leverage generally deviates from the factor 2.The ShortDAX x2 (monthly) measures double the negative monthly performance of the DAX index. Its performance is positive when the DAX falls.

The four STOXX and DAX strategy indices are calculated in euro. Daily historical index values are available back to December 31, 1991 for the EURO STOXX 50 Monthly Leverage and Short indices and back to December 30, 1987 for the LevDAX x2 (monthly) and ShortDAX x2 (monthly) indices. The cost of borrowing and the benefit of earning interest are also taken into account in the calculation of the new indices.

The EURO STOXX 50 Monthly Leverage and EURO STOXX 50 Monthly Double Short indices are part of the STOXX Strategy Index family.

Source: ETFWorld – STOXX




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