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The Markets April 20, 2011
S&P Introducing New Versions of S&P 500
S&P Indices is launching two indexes
designed to provide market participants with unique measuring tools for
specific stock characteristics within the S&P 500.
Reported by Rebecca Moore
The S&P 500 Low Volatility Index measures the performance of the 100 least volatile stocks in the S&P 500. The Index is designed to serve as a benchmark for low volatility or low variance strategies in the U.S. stock market, the company said. Constituents are weighted relative to the inverse of their corresponding volatility, with the least volatile stocks receiving the highest weights.
The S&P 500 High Beta Index will measure the performance of the 100 constituents of the S&P 500 that are the most sensitive to changes in market returns. It is designed to serve as a benchmark for investors with a bullish strategic or tactical view of the U.S. stock market. Constituents are weighted in proportion to their market sensitivity, or beta, with the highest-beta stocks receiving the highest weights.
Both the S&P 500 Low Volatility Index and the S&P 500 High Beta Index will serve as the basis for future PowerShares ETFs.
For more information, visit http://www.standardandpoors.com/indices.