S&P Dow Jones Indices (SPDJI) has launched three indices that combine sharia-compliant bonds and equities to create benchmarks for Islamic multi-asset funds.
The indices work by combining the S&P Pan Arab Composite Shariah index, which tracks sharia-compliant equities in the Arab world, with the Dow Jones Sukuk Index, which tracks Islamic bonds, at different weights.
The conservative version of the new “balanced” index has a one-quarter allocation to equities and three-quarters to bonds, the moderate version has a 60-40 split, and the growth version allocates three-quarters equities to one-quarter bonds.
“Offering three indices with differing equity and sukuk weights allows investors to utilise an index that best reflects their investment style,” says Michael Orzano, director, global equity indices, SPDJI.
The firm says the three indices in the S&P Pan Arab Shariah Balanced Index Family can serve as benchmarks for multi-asset funds or form the basis for investment products.
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