Nasdaq Expands Suite of Indexes Into New Themes and Regions
What’s New: Nasdaq Expands Suite of Indexes into New Themes and Regions
Innovation is at the heart of everything we do at Nasdaq. With a best-in-class index development team, we are continually exploring new ideas and ways to bring exciting products to market with our partners. Over the last year, we’ve worked closely with several clients to launch products that do just that. From changing global dynamics to concerns around an unpredictable market environment, our index team has been working overtime to develop bespoke strategies that address changing investment themes. Let’s explore a few of the launches:
Nasdaq IFED Indexes
In partnering with Economic Index Associates (EIA), which focuses on Fed policy and capital market , our index team launched the Nasdaq IFED US Large-Cap™ Index (IFED-L™) and the Nasdaq IFED US Large-Cap Low Volatility™ Index (IFED-LV™).
In the midst of uncertain market conditions, IFED-L brings a unique advantage – it adjusts portfolio holdings based on Fed policy actions. The model relies on Fed policy signals to classify market conditions into one of three environments: expansive, restrictive or indeterminate. The model selects a portfolio of stocks best positioned to prosper during the identified market environment.
IFED-LV takes a similar approach but is designed to maximize exposure to those U.S. large-cap, low volatility equities best positioned to benefit from prevailing market conditions.
The design of these strategies allows the indexes to capture upside potential while limiting downside risk by being fully invested in equities that are environment-aligned and have robust firm-specific metrics. Moreover, they can be customized to meet client constraints and requests. Some strategies go in and out of vogue, but the IFED strategy is an all-weather approach due to the adjustments it incorporates in response to changing market environments.
Nasdaq Sprott Energy Transition Materials Index Suite
Global energy dynamics are changing, and the launch of the Nasdaq Sprott Energy Transition Materials Index Suite provides exposure to critical minerals driving the world’s transition to cleaner energy. These indexes are designed to track companies best positioned to provide the critical minerals needed to support cleaner energy development and operation, and the building of electric vehicles. This support will help nations around the world meet global mandates to reduce carbon emissions by embracing low-carbon and renewable energy sources. The Nasdaq Sprott Energy Transition Materials Suite covers the gamut of critical minerals essential to the generation, transmission and storage of cleaner energy.
Nasdaq Sprott Energy Transition Materials Select™ Index
Nasdaq Sprott Junior Uranium Miners™ Index
Nasdaq Sprott Energy Transition Materials™ Index
Nasdaq Sprott Lithium Miners™ Index
Nasdaq Sprott Junior Nickel Miners™ Index
Nasdaq Sprott Nickel Miners™ Index
Sprott Asset Management launched the following ETFs in the U.S. based on these indexes:
Sprott Energy Transition Materials ETF (SETM)
Nasdaq Sprott Junior Copper Miners ETF (COPJ)
Nasdaq Sprott Junior Uranium Miners ETF (URNJ)
Nasdaq Sprott Lithium Miners ETF (LITP)
Sprott Nickel Miners ETF (NIKL)
Index-Linked Annuities and Insurance Products
Nasdaq partnered with Salt Financial to develop multi-asset, risk-controlled indexes that provide target volatility index solutions for use within the Fixed Index Annuities and structured notes space.
The indexes are powered by Salt Financial’s proprietary truVol® Risk Control Engine (RCE) methodology, and provide insurance companies and their clients with a new way to access components of some of Nasdaq’s most popular indexes, including the Nasdaq-100® (NDX® ) and Nasdaq Next Generation 100TM (NGXTM) indexes.
The Nasdaq-100 5% Target Volatility™ Index is designed to deliver exposure to the Nasdaq-100 Total Return Index™ (XNDX™) while targeting a constant 5% level of volatility.
The Nasdaq Generations 5™ Index, linked exclusively to Fixed Index Annuities at SILAC Insurance Company, provides a new way to access components of both NDX® and NGX™ in a format that aims for stability in volatile markets, while providing exposure to the leaders of today and access to the disrupters of tomorrow
Nasdaq Innovators Completion Cap™ Index
In June we expanded the Nasdaq Innovation Suite beyond the large-cap Nasdaq-100 and the midcap Nasdaq Next Generation 100 to include a small-cap option for investors to consider. The Nasdaq Innovators Completion Cap Index (NCX™) provides access to companies with attractive patent portfolios to help investors capture growth in the small-cap equity space. NCX tracks the performance of 200 Nasdaq-listed companies not represented in the Nasdaq-100 Index (NDX) or Nasdaq Next Generation 100 Index (NGX), utilizing patent data from IPR Strategies, a leader in the science of patent valuation.
Invesco has since launched the Invesco Nasdaq Future Gen 200 ETF (QQQS), which tracks the Nasdaq Innovators Completion Cap Index (NCX).
Nasdaq®, Nasdaq-100 Index®, Nasdaq-100®, and NDX®, are trademarks of Nasdaq, Inc. The information contained above is provided for informational and educational purposes only, and nothing contained herein should be construed as investment advice, either on behalf of a particular security or an overall investment strategy. Neither Nasdaq, Inc. nor any of its affiliates makes any recommendation to buy or sell any security or any representation about the financial condition of any company. Statements regarding Nasdaq-listed companies or Nasdaq proprietary indexes are not guarantees of future performance. Actual results may differ materially from those expressed or implied. Past performance is not indicative of future results. Investors should undertake their own due diligence and carefully evaluate companies before investing. ADVICE FROM A SECURITIES PROFESSIONAL IS STRONGLY ADVISED. © 2023. Nasdaq, Inc. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
