- Largest ever international index provider benchmark switch
- Includes world's largest emerging markets fund, the $67bn Vanguard Emerging Markets Stock Index Fund
- FTSE becomes third-largest equity ETF index benchmark provider globally
- Reinforces FTSE's growing US presence, and global top 3 position
FTSE Group ("FTSE") has been selected by Vanguard, one of the top three US asset management firms, as the index benchmark provider for six international equity index funds with aggregate assets of $170 billion as of August 31. These funds will transition to benchmarks in the FTSE Global Equity Index Series, replacing MSCI.
This transaction represents the largest international index provider benchmark switch ever and includes the world's largest emerging markets fund, the $67bn Vanguard Emerging Markets Stock Index Fund and its exchange-traded fund (Ticker: VWO). These funds will move to the FTSE Emerging Index.
"Today's agreement with Vanguard underlines FTSE's continuing growth as a global brand," says Mark Makepeace, Chief Executive of the FTSE Group. "With the switch, FTSE will become the third-largest equity exchange traded product index benchmark provider globally, with more than $124 billion in ETF assets benchmarked to FTSE indices."
"This agreement represents another significant step forward in making the FTSE name as prominent in the United States as it is elsewhere in the world," adds Jonathan Horton, President, FTSE North America. "FTSE is committed to building long-term, sustainable relationships with clients in the US and around the world to bring real value to investors."
Vanguard conducted a rigorous selection process, which evaluated the quality and suitability of the respective indices. "The FTSE indexes are well constructed, offer comprehensive coverage of their respective markets, and meet Vanguard's 'best practice' standards for market benchmarks," said Vanguard Chief Investment Officer Gus Sauter. "The benchmarks offer comprehensive and diversified coverage of the international developed and emerging markets."
The long-term licensing agreement expands an already deep relationship between FTSE and Vanguard. Vanguard already employs FTSE benchmarks for more than 20 index portfolios around the world, representing $26 billion in aggregate assets, including nine ETFs benchmarked with a total AUM of $13.4 billion listed in the US, UK and Australia. FTSE will be a partner in Vanguard's international growth strategy going forward, with products already announced in the UK and Canada.