Zug 12 June 2020
Qontigo has licensed the iSTOXX® MUTB Global ex Australia Quality Leaders Index AUD Hedged to Australian ETF manager BetaShares, for use in their newly launched ETF. Based on a combined screening and ranking of fundamental indicators, the index selects the highest quality companies from the STOXX Global 1800 ex Australia Index.
“We’re excited to be partnering with Qontigo to launch this ETF as a follow up to our successful QLTY ETF, which we launched in collaboration with STOXX in late 2018. The indexing approach taken is both intuitive and innovative. Our newly hedged product provides another access point for investors seeking out a core portfolio allocation in international equities while at the same time looking to substantially eliminate the currency variable from the investment equation,” said Alex Vynokur, CEO of BetaShares.
“Portfolio-theory research has observed a series of risk factors that have above-average market returns, including quality. The iSTOXX MUTB Quality Indices select the best companies from the components of the broad STOXX Global 1800 ex Australia index, based on four fundamental indicators: profitability, leverage, cash flow generation ability, and business stability. The iSTOXX MUTB Global ex Australia Quality Leaders Index AUD Hedged has an additional hedging component, and is denominated in Australian dollars,” said Stephan Flaegel, Global Head of Indices & Benchmarks at Qontigo.
Only stocks with positive shareholder’s equity, total assets and net cash flow from operating
activities and data available for current total debt and net income data are eligible. The indices are weighted according to free-float market capitalization with a 2% maximum capping per constituent. The index combines the performance of the unhedged underlying index with a hypothetical rolling investment in one-month foreign-exchange forward contracts, with monthly adjustment of invested notional and currency exposures.
Details about the methodology can be found in the iSTOXX® Methodology Guide.