John Jacobs, Executive Vice President, NASDAQ OMX Global Information Services, addresses the the future of our indexing business in the fifth installment of his video series.
Transcript: Let’s take a look at where we think NASDAQ OMX Global Indexes will be in a year or two down the road. As a global indexer with multi-asset classes, our near term strategy is to continue to roll out our superior technology on two fronts: The ability to calculate more indexes across more asset classes, so you’ll see us adding in more asset classes like fixed income and commodities. And the ability to have a superior data offering. We’re going to be able to offer data in a far more convenient fashion to the end user in a better way than it’s ever been offered before. So those are two near-term strategies. In addition, there’s been a tremendous movement and demand from the buy side and the sell side, those firms on the street, and those ultimate investors, for more custom capabilities and calculation, and we’re going to be offering a lot more custom indexes to partner with different firms, so they can find exactly what they want for their investment thesis. Whether they want geography or style or some other asset class, we’ll be able to provide that for them. So you’ll see a lot of growth in the custom [indexing]. You’ll continue to see us roll out more exchange traded products. You’ll see more structured products, and you’ll see a richer data set come out from us, both price data and weights and components. We also have recently announced that we’re acquiring eSpeed, which is a fixed income business, so you’ll be seeing a rich data set from fixed income, on-the-run treasuries, and an index family as well. So the next one to two years is going to be a very exciting time for NASDAQ OMX Global Indexes as we continue to fill out our mandate of multi-asset class, a scalable technology solution, create a better value proposition, and the richest, most robust data set in the index business.
NASDAQ OMX Global Indexes has partnered with Newfound Research LLC to create several rules-based, quantitatively enabled investment strategies. The indexes launched on October 23rd, 2013. Together, the two companies will create a suite of outcome-oriented indexes and work jointly to promote licensing opportunities.
The initial indexes will include a Risk Managed Income strategy, a Global Defensive Equity strategy, a Target Excess Yield strategy and a U.S. Equity Dynamic Long/Short strategy.
NASDAQ OMX and Newfound will be able to license and implement through separately managed accounts and, in some cases, through exchange-traded funds (ETFs). Together, we will promote the product and provide educational information about how indexing works and how these investment strategies might fit into a client's portfolio.
"NASDAQ OMX continues to focus on innovation and partnering with exceptional firms like Newfound, one of the most inventive and sought after organizations developing rules-based, outcome-oriented investment strategies and specializing in tactical asset and risk management,” said Dave Gedeon, Managing Director, NASDAQ OMX Global Indexes. “This relationship brings our respective brands and expertise together to develop a unique product family.”
“Newfound seeks strategic partners like NASDAQ OMX,” said Corey Hoffstein, Newfound’s Chief Investment Officer. “By combining our unique and complementary strengths, including Newfound’s quantitative models and NASDAQ OMX’s global brand, this partnership allows us to provide both retail and institutional investors with a full suite of structured investment strategy solutions.”
Tom Rosedale, Newfound’s CEO, said, "We are excited to partner with a leading, full-service index provider like NASDAQ OMX. We believe that NASDAQ OMX’s index construction and technology expertise and powerful brand can make our quantitatively enabled, rules-based investment strategies available to investors throughout the world.”
Learn more about NASDAQ Custom Indexing capabilities or contact Rob Hughes, Vice President, NASDAQ OMX Global Indexes +1 212 401 8987.