S&P adds “quality” indices to factor-based range

Focus on qualityS&P Dow Jones Indices has added to its range of factor-based investment tools with a selection of indices that measure stocks with a high “quality” score. Scoring stocks based on quality – a factor that takes in return on equity, accruals ratio and financial leverage ratio – is one of several alternative strategies to the traditional method of weighting stocks according to market capitalisation. The launch of the 12 indices follows the firm's unveiling of Low Beta and Intrinsic Value index sets earlier this year, which are also aimed at giving investors an alternative to cap-weighting – a technique known as “smart beta”. “Quality is a risk factor that is distinct from other known factors like size, value, momentum, and low volatility,” says Vinit Srivastava, senior director of strategy indices at S&P Dow Jones Indices, who adds that the new tools capture the characteristics of high quality companies. The set of indices includes US, European, Asian, Japanese, developed and emerging market products, and are based on the S&P Global Broad Market Index or other headline benchmarks. ©2014 funds europe

Executive Interviews

INTERVIEW: Put your money where your mouth is

Jun 10, 2016

At Kempen Capital Management, they believe portfolio managers should invest in their own funds. David Stevenson talks to Lars Dijkstra, CIO of the €42 billion manager.

EXECUTIVE INTERVIEW: ‘Volatility is the name of the game’

May 13, 2016

Axa Investment Managers chief executive officer, Andrea Rossi, talks to David Stevenson about bringing all his firm’s subsidiaries under one name and the opportunities that a difficult market...


ROUNDTABLE: Beyond the hype

Oct 13, 2016

The use of smart beta investing continues to grow. Our panel, made up of both providers and users, discusses what the strategy actually means, how it should be used and the kind of pitfalls that may arise when using this innovative investment technique.

MIFID II ROUNDTABLE: Following the direction of travel

Sep 07, 2016

Fund management firms Aberdeen and HSBC Global meet with specialist providers to speak about how the industry is evolving towards MiFID II.