FTSE Licenses Old Mutual Global Index Trackers With Use of Leading Alternatively-Weighted Indices for Two New Index-Tracking Funds

London - 12 March 2012

FTSE Group (“FTSE”), the award winning global index provider, announces the licensing of the globally established FTSE RAFI Index Series and the recently launched FTSE EDHEC-Risk Efficient Index Series, to Old Mutual Global Index Trackers (“OMGxT”). The adoption of these indices highlights investors increasing interest in alternatively-weighted sources of passive investment, and FTSE’s fast growing index range within this space.

The choice of alternatively-weighted indices reinforces investor demand for new and innovative tools to capture systematic sources of return, diversify core portfolios and complement existing market-capitalised strategies.

Launched over six years ago and created in partnership with Research Affiliates the FTSE RAFI Index Series, introduced a new approach to indexing and forms the basis for a range of index-linked products globally. Rather than using market capitalisation, constituents are weighted in accordance with the following four ‘fundamental’ factors; total cash dividends, free cash flow, total sales and book equity value.

More recently the FTSE EDHEC-Risk Efficient Index Series, launched in association with EDHEC-Risk Institute (EDHEC-Risk), employs a systematic approach which aims to capture equity market returns whilst offering improved risk/reward efficiency – offering greater diversification.

Jonathan Cooper, Managing Director, FTSE Middle East and Africa, noted: “Old Mutual Global Index Trackers’ core business makes FTSE a natural partner for successful product issuers who seek to develop alternatively-weighted index products. Their adoption of FTSE non market-cap weighted indices demonstrates their recognition of our expertise and wide choice, as well as creating a new opportunity set for index tracking managers.”

Kingsley Williams, Head of Research at OMGxT said: “Alternatively weighted index-tracking funds offer investors the best of both worlds; low cost funds, a robust investment methodology and the potential for enhanced returns relative to market-cap index-tracking funds.”

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