NEW YORK, Mar. 14, 2005 -- Dow Jones Indexes, a leading global index provider, and Wilshire Associates Incorporated, one of the worldâs leading investment consulting, investment management and investment technology firm, announced that beginning today the new Dow Jones Wilshire U.S. Style index benchmarks are available real-time. The new index series covers five investment "styles" -- large-capitalization growth, large-cap value, small-cap growth, small-cap value and micro-caps -- reflecting the make-up of the Dow Jones Wilshire 5000 index.
"The new Dow Jones Wilshire Style Indexes cover the entire U.S. market, rather than just part of it" said John A. Prestbo, Editor of Dow Jones Indexes. "Moreover, this comprehensive perspective is achieved with an easily understood set of rules that defines equity investing styles simply and cleanly," he added.
"We strongly believe that the Dow Jones Wilshire Style Indexes present the best benchmark option available and are ideal as the foundation for investable products," said Dennis Tito, founder, Chairman and Chief Executive Officer of Wilshire Associates. "By including micro-caps as a fifth style, weâve ensured that the entire economic space is represented as a style universe with no artificial cut-offs of the market. We expect the industry will find this approach compelling given that in the past three years micro-cap stocks have seen an annualized performance of nearly 25 percent and many institutional investors are allocating more to this asset class."
The style indexes are the second phase of the Dow Jones Wilshire family of co-branded indexes that now includes a comprehensive set of U.S. indexes (broad-market, sector, size and style). A third phase will extend the Dow Jones Wilshire methodology internationally, thus providing in addition to the unique breadth the advantages of consistent global coverage with objective and transparent rules.
The Dow Jones Wilshire indexes are broad enough to include all stocks for attribution analysis with a merged methodology that is among the most sophisticated being used by index providers. Six factors are used for style classification -- some index providers use as few as one or two factors -- and Dow Jones Wilshire classifies each stock as wholly either growth or value to eliminate overlap that can allow for undesirable âstyle driftâ in stock portfolios.
The six equally weighted factors that are used to classify growth and value are:
Two backward looking: five-year average earnings growth and sales growth
Two current: Price/Book value ratio and dividend yield
Two forward looking: forecasts of Price/Earnings ratios and long-term earnings growth
This rollout includes the real-time calculation of the following style indexes:
Ticker Full Name
DWL Dow Jones Wilshire U.S. Large-Cap Index
DWS Dow Jones Wilshire U.S. Small-Cap Index
DW25 Dow Jones Wilshire 2500 Index
DWMI Dow Jones Wilshire U.S. Micro-Cap Index
DWLG Dow Jones Wilshire U.S. Large-Cap Growth Index
DWLV Dow Jones Wilshire U.S. Large-Cap Value Index
DWSG Dow Jones Wilshire U.S. Small-Cap Growth Index
DWSV Dow Jones Wilshire U.S. Small-Cap Value Index