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Natixis and Nasdaq announce exclusive licensing partnership

First Published 24th July 2017

New Index aims to reduce market capitalization biases. NASDAQ-100 Target 25 Excess Return Index will be used as an underlying index for structured solutions.

Dave Gedeon, Nasdaq

Dave Gedeon, Nasdaq

New York - Natixis has entered into an exclusive licensing agreement with Nasdaq for the newly-launched Nasdaq-100 Target 25 Excess Return Index. The index aims to address the market capitalization biases of traditional indices and will be used as an underlying index for structured solutions. The strategy can also be used as a smart beta diversifier for Nasdaq-100 investors.

The newly-created index selects 25 of the 100 companies included in the NASDAQ-100 Index. All 25 companies have smaller market capitalizations, are equally weighted, and possess the highest free cash flow yields. It then replicates the performance of the total return version, where dividends are reinvested, and discounts a fixed dividend of 2.5% in order to calculate the excess return.

Price return, total return, net total return, excess return and net excess return versions of the index are available, and the index, which will be rebalanced on a quarterly basis, is calculated in US dollars.

"Today's announcement demonstrates Nasdaq's continued efforts in driving index innovation by seeking out great partners to bring new concepts out into the market," said Dave Gedeon, Head of Index Research & Development, Nasdaq.