FTSE to include emerging markets

By Staff | November 2, 2011 | Last updated on November 2, 2011
1 min read

Global index provider FTSE Group has expanded its Diversification Based Investing (DBI) Index Series to include emerging markets.

Like the FTSE DBI Developed indexes, launched in September 2010, the FTSE DBI All Emerging Markets Index is non-market capitalization weighted, promoting diversification across countries and industry sectors.

The philosophy behind the index is that both geography and industry are the primary drivers of global equity risk and return, and that market sentiment can lead to concentration risk in market-cap weighted indices. A macro diversified portfolio helps to avoid this concentration risk and should lessen downside risk. The index diversifies exposure by re-weighting countries and industries to avoid concentration risk and momentum effects.

The index is derived from the FTSE All Emerging Markets Index Series, which is market-cap weighted and made up of large and mid-cap companies within advanced and secondary emerging markets.

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The staff of Advisor.ca have been covering news for financial advisors since 1998.