STOXX Ltd has announced that the iSTOXX MUTB Japan Proactive Leaders 200 Index has been licensed to Mitsubishi UFJ Kokusai Asset Management (MUKAM) to underlie an exchange-traded fund (ETF) in Tokyo. The ETF will be available on Tokyo Stock Exchange as of 29/06/2016…
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The iSTOXX MUTB Japan Proactive Leaders 200 Index aims to capture the performance of quality companies which actively reinvest in their physical and human capital. It has been developed in collaboration with the leading Japanese trust bank Mitsubishi UFJ Trust and Banking Corp. (MUTB). MUKAM represents the investment trust business that focuses on meeting a wide range of client asset management needs. MUKAM and MUTB are both part of the Mitsubishi UFJ Financial Group (MUFG).
“The iSTOXX MUTB Japan Proactive Leaders 200 Index offers a unique opportunity to track the performance of leading Japanese companies in terms of overall quality and stability of their businesses but also reinvestment in physical and human capital. By investing into long-term business development and their employees, these companies demonstrate a forward-looking approach,” said Matteo Andreetto, chief executive officer, STOXX Limited. “We are delighted that MUKAM chose this innovative smart-beta index to further expands its offering to market participants in Japan.”
“In December last year, the Bank of Japan (BOJ), as part of their quantitative and qualitative easing enhancement measures, announced that they will support domestic firms that are proactively making investments in physical and human capital. The BOJ decided to put aside 300 billion Yen yearly to purchase ETFs that comprise of such companies. This index has received BOJ approval on Jun. 10, and as a result allows this ETF to be one of the BOJ’s investment vehicles,” said Hideo Shirota, Director, Mitsubishi UFJ Kokusai Asset Management.
“As for the concept of this index, in which companies are included that have stable and high profitability, focus is put on companies that proactively invest towards creating future growth, and thus can be expected to provide good performance as well. I feel that it will receive wide spread attention from both retail and institutional investors.”
The iSTOXX MUTB Japan Quality Proactive Leaders 200 Index is derived from the STOXX Japan 600 Index. The best companies are selected, based on a combined ranking of four fundamentals indicators (high profitability, low leverage, cash flow generation ability and business stability) and two capital investment factors (physical and human). The physical capital investment factor is calculated as the average of the following three sub-factors: change in capital expenditures (Capex), ex-Capex (Capex-depreciation), and Research and Development. The human capital investment factor is calculated as the average of the following five sub-factors: change in number of employees, change in average wage, working environment/system, skill and motivation program and empowering of women. Stocks need to fulfill minimum liquidity, and credit risk criteria before being added to the index. The top ranked 200 stocks based on the selection criteria are eligible for inclusion in the index.
The iSTOXX MUTB Japan Proactive Leaders 200 Index is weighted by free-float market cap, with a 2% weighting cap for individual components. The index is reviewed and rebalanced semi-annually in June and December after the review of the underlying index.
The iSTOXX MUTB Japan Quality Proactive Leaders 200 Index is calculated in price, net and gross return versions and is available in EUR, JPY and USD. Daily historical index level data is available from Dec. 22, 2008.