NEW YORK, Oct. 25 /PRNewswire/ -- Designed to track the credit default swap market for sovereign entities, Standard & Poor's - the world's leading index provider – announced today that it has launched a series of CDS Sovereign Indices. The index series is comprised of the S&P International Developed Nation Sovereign CDS Index and S&P Eurozone Developed Nation Sovereign CDS Index.
Credit Default Swaps are over-the-counter, tradable, credit derivative contracts that have generally been viewed as similar to insurance policies.
"The feedback that we have received from some market participants is that sovereign CDS indices should be more representative of the portfolio holdings and market weights," says J.R. Rieger, Vice President of Fixed Income Indices at S&P. "The launch of the S&P CDS Sovereign Indices not only meets this market demand, but allows users of the Indices to directly make comparisons to the International bond market while offering a perspective on the cost of default protection based on those market weights."
The S&P International Developed Nation Sovereign CDS Index has been constructed to have approximately the same country constituents and weightings as the S&P/Citigroup International Treasury Bond (ex U.S.) Index. Similarly, the construction of the S&P Eurozone Developed Nation Sovereign CDS Index provides approximately the same country constituents and weightings as the S&P Eurozone Government Bond Index.
The country constituents and weights for each Index are set at the inception of each index series. On each Rollover date, a new series will be launched with the current weights and constituents of the respective bond indices. Both of these indices have a 5 1/4 year maturity as measured from the effective date.
Complete details of the methodology, including the criteria for index additions and removals, policy statements, and research papers are available at www.fixedincomeindices.standardandpoors.com.
About S&P Indices
S&P Indices, the world's leading index provider, maintains a wide variety of investable and benchmark indices to meet an array of investor needs. Over $1.25 trillion is directly indexed to Standard & Poor's family of indices, which includes the S&P 500, the world's most followed stock market index, the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, the S&P Global BMI, an index with approximately 11,000 constituents, the S&P GSCI®, the industry's most closely watched commodities index, and the S&P National AMT-Free Municipal Bond Index, the premier investable index for U.S. municipal bonds. For more information, please visit www.standardandpoors.com/indices.
About Standard & Poor's
Standard & Poor's, a subsidiary of The McGraw-Hill Companies (NYSE: MHP), is the world's foremost provider of independent credit ratings, indices, risk evaluation, investment research and data. With offices in 23 countries and markets, Standard & Poor's is an essential part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with the independent benchmarks they need to feel more confident about their investment and financial decisions. For more information, visit http://www.standardandpoors.com
SOURCE Standard & Poor's