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Markit launches first ultrashort bond indices
18 October 2013
One year duration risk indices licensed to iShares for ETFs
Markit has launched a series of global cash bond indices for ultra-short investment grade credit.
The Markit iBoxx Liquid Ultrashort indices give investors access to credit markets with a duration risk of one year or less and have been licensed to BlackRock, with three iShares exchange traded funds (ETFs) to be launched using the indices.
Armins Rusis, managing director and global head of information at Markit, said:
“Our in-depth knowledge of the fixed income market coupled with our index construction expertise have enabled us to index the ultrashort duration space, a global first for this market segment. Our index calculation capabilities and experience in providing extensive pricing services were a cornerstone of this effort.
“This development illustrates our ongoing commitment to extending the Markit iBoxx family of indices globally. We are delighted that BlackRock selected our indices to serve as the basis for three of their ETFs.”
The new index suite includes indices covering the USD, EUR and GBP markets. The indices have been designed to ensure diversified investment grade credit exposure, through a combination of investment grade corporate bonds with a time to maturity of between zero and one year, plus floating rate securities with a maturity of zero to three years.
Markit said pricing was based on its own bond pricing service, which draws on multiple sources. Markit added that it also recently launched a suite of investment grade and high yield short duration indices, holding dollar-denominated securities with maturities of between zero to five years.