New index gives better picture of market
The Italian equity market is awaiting the arrival of a new index. The Italian stock exchange, Borsa Italiana, and global equity index provider Standard & Poor’s have established a partnership to launch a new index intended to become the benchmark for the Italian equity market.
The new index, to be named S&P/MIB 45, will replace the MIB 30.
According to both organisations, the new index will have a sectoral balance that better reflects the Italian market. Each of the index constituents will be weighted using an equity-free-float adjustment that reflects its overall importance in Italy’s equity market.
The S&P/MIB 45 is designed to provide a broader and more accurate representation of the entire Italian equities market than the MIB 30, and will cover approximately 80% of Italy’s market capitalisation.
“The implications of this new index for both the Italian retail and institutional markets will be quite significant since currently the only index of relevance in Italy is the MIB 30 and this is about to be changed,” says Ryan Carrier, director of global business development at Standard and Poor’s in New York.
Borsa Italiana is Standard & Poor’s first alliance with a leading equity exchange in Europe and part of the firm’s strategy of offering investors consistent local and global investable indices. Although details of the new index has not yet been released, the S&P/MIB 45 will have the Global Industry Classification Standard (GICS) applied to each constituent. These classifications are expected to be applied throughout the entire Italian equities market.
Standard & Poor’s is expected to become Borsa Italiana’s primary index provider for all equity indices in Italy over the coming months.