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One Addition and One Deletion in S-Network Quality Sector Dividend Dog Index Quarterly Rebalancing

  • September 17, 2019
  • S-Network Global Indexes

New York, NY, Tuesday, September 17, 2019 — The S-Network Quality Sector Dividend Dog IndexSM (TICKER: SNQDIV) will add one constituent and drop one constituent in its quarterly rebalancing, effective 9:30 AM (ET) Wednesday, September 18, 2019, maintaining the number of index components at 50.

The addition to SNQDIV is: Cbs Corp B (TICKER: CBS US).

The deletion from SNQDIV is: Tribune Media Co A (TICKER: TRCO US).

The S-Network Quality Sector Dividend Dogs Index (SNQDIV) comprises five stocks in each of 10 GICS Sectors (excluding Real Estate) from the S-Network US Equity Large/Mid-Cap 1000 Index (SN1000) selected for high dividend yield and high ratio of free cash flow to debt. The index reconstitutes each December and rebalances quarterly. SNQDIV excludes pass-through securities.

 

SNQDIV is rules based and fully transparent, employing a methodology that weights all 50 index constituents equally. Information about the index can be found at snetworkglobalindexes.com.

 

Index: S-Network Quality Sector Dividend Dog Price Index                      TICKER: SNQDIV

 

Index: S-Network Quality Sector Dividend Dog Total Return Index            TICKER: SNQDIVT

One Addition and One Deletion in S-Network Developed International Dividend Index Quarterly Rebalancing

  • September 12, 2019
  • S-Network Global Indexes

New York, NY, Thursday, September 12, 2019 — The S-Network Developed International Dividend IndexSM (TICKER: SNIDIV) will add one constituent and drop one constituent in its quarterly rebalancing, effective 6:00 PM (ET) Sunday, September 22, 2019, maintaining the number of index components at 100.

The addition to SNIDIV is: PHOENIX GROUP HOLDINGS PLC (TICKER: PHNX LN).

The deletion from SNIDIV is: Amp Ltd (TICKER: AMP AU).

More information can be found at www.snetglobalindexes.com.

 

Index: S-Network International Dividend Price Index TICKER: SNIDIV

 

Index: S-Network International Dividend Total Return Index TICKER: SNIDIVTR

Four Additions and Three Deletions in Climate Advisers Better Palm Oil Index Quarterly Reconstitution

  • September 12, 2019
  • S-Network Global Indexes

New York, NY, Thursday, September 12, 2019 — The Climate Advisers Better Palm Oil IndexSM (TICKER: CABPLM) will add four constituents and drop three constituents in its quarterly reconstitution, effective 6:00 PM (ET) Sunday, September 22, 2019, changing the number of index components to 18.

The additions to CABPLM are: BUMITAMA AGRI LTD (TICKER: BAL SP), LAM SOON (THAILAND) PCL (TICKER: LST TB), CHUMPORN PALM OIL IND PUB CO (TICKER: CPI TB), UNITED PALM OIL INDUSTRY PUB (TICKER: UPOIC TB).

The deletions from CABPLM are: M P EVANS GROUP PLC (TICKER: MPE LN), BOUSTEAD PLANTATIONS BHD (TICKER: BPLANT MK), KWANTAS CORP BHD (TICKER: KWAN MK).

The Climate Advisers Better Palm Oil Index (Ticker: CABPLM) is an equity index designed to serve as an equity benchmark for globally traded stocks of companies that are members of the Roundtable on Sustainable Palm Oil (RSPO).

 

More information can be found at snetglobalindexes.com.

 

Index: Climate Advisers Better Palm Oil IndexSM                         TICKER: CABPLM

 

Index: Climate Advisers Better Palm Oil Total Return IndexSM     TICKER: CABPLMT

Three Additions and Two Deletions in S-Network ADR Dividend Dogs Index Quarterly Rebalancing

  • September 12, 2019
  • S-Network Global Indexes

New York, NY, Thursday, September 12, 2019 — The S-Network ADR Dividend Dogs IndexSM (TICKER: SNADRX) will add three constituents and drop two constituents in its quarterly rebalancing, effective 6:00 PM (ET) Sunday, September 22, 2019, changing the number of index components to 50.

The additions to SNADRX are: Ternium Sa Adr (TICKER: TX US), Fanuc Corp-Unsp Adr (TICKER: FANUY US), Enersis Chile Sa (TICKER: ENIC US).

The deletions from SNADRX are: Intl Conslidated A-Spons Adr (TICKER: ICAGY US), Red Electrica Cor-Unspon Adr (TICKER: RDEIY US).

The S-Network ADR Dividend Dogs Index (SNADRX) is a portfolio of stocks derived from the S-Network Global Depositary Receipt Index (SNGDRX). The SNADRX methodology selects the five stocks in each of 10 of the GICS sectors that make up SNGDRX which offer the highest dividend yields as of the last trading day of May.

 

SNGDRX is rules based and fully transparent, employing a methodology that weights all 50 index constituents equally.

 

Index: S-Network ADR Dividend Dogs Index TICKER: SNADRX

 

Index: S-Network ADR Dividend Dogs Total Return Index TICKER: SNADRXT

29 Additions and 10 Deletions in Deferred Revenue Index Quarterly Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The Deferred Revenue IndexSM (TICKER: SNDRVX) will add 29 constituents and drop 10 constituents in its quarterly reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, changing the number of index components to 218.

The additions to SNDRVX are: Altice USA Inc (TICKER: ATUS US), Cable One Inc. (TICKER: CABO US), CARGURUS INC (TICKER: CARG US), Amc Networks Inc.-A (TICKER: AMCX US), Yelp Inc A (TICKER: YELP US), Home Depot Inc (TICKER: HD US), Lowe'S Cos Inc (TICKER: LOW US), Best Buy Co Inc (TICKER: BBY US), Planet Fitness Inc A (TICKER: PLNT US), Toll Brothers Inc (TICKER: TOL US), Foot Locker Inc (TICKER: FL US), Aaron'S Inc. (TICKER: AAN US), Floor & Decor Holdings, Inc. Class A (TICKER: FND US), Monster Beverage Corp (TICKER: MNST US), Bio-Rad Laboratories Inc A (TICKER: BIO US), Exelixis Inc (TICKER: EXEL US), Syneos Health, Inc (TICKER: SYNH US), Repligen Corp (TICKER: RGEN US), Omnicell Inc (TICKER: OMCL US), Southwest Airlines Co (TICKER: LUV US), Mercury Systems Inc (TICKER: MRCY US), Salesforce.Com (TICKER: CRM US), Vmware Inc A (TICKER: VMW US), Netapp Inc (TICKER: NTAP US), Realpage Inc (TICKER: RP US), Verint Systems (TICKER: VRNT US), Qualys Inc. (TICKER: QLYS US), Freeport-Mcmoran Inc (TICKER: FCX US), The Chemours Company (TICKER: CC US).

The deletions from SNDRVX are: Fox Corp - CLASS A (TICKER: FOXA US), Electronic Arts (TICKER: EA US), Carnival Corp (TICKER: CCL US), Brunswick Corp (TICKER: BC US), Dick'S Sporting Goods Inc (TICKER: DKS US), Heico Corp (TICKER: HEI US), United Continental Holding Inc (TICKER: UAL US), Kirby Corp (TICKER: KEX US), Guidewire Software (TICKER: GWRE US), Pegasystems Inc (TICKER: PEGA US).

The Efficient Alpha Capital (“EAC”) Indexes leverage years of Private Equity investing experience to develop a differentiated approach in creating portfolios of public equities. The EAC Indexes are designed to identify companies with superior fundamental financial characteristics that are trading at reasonable valuations.

 

More information can be found at snetglobalindexes.com.

 

Index: Efficient Alpha Deferred Revenue IndexSM                        TICKER: SNDRVX

 

Index: Efficient Alpha Deferred Revenue Total Return IndexSM          TICKER: SNDRVXT

47 Additions and 47 Deletions in S-Network Developed International Dividend Index Annual Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The S-Network Developed International Dividend IndexSM (TICKER: SNIDIV) will add 47 constituents and drop 47 constituents in its annual reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, maintaining the number of index components at 100.

The additions to SNIDIV are: British American Tobacco Plc (TICKER: BATS LN), Eni Spa (TICKER: ENI IM), Bayer Ag (TICKER: BAYN GR), Vodafone Group (TICKER: VOD LN), Telefonica Sa (TICKER: TEF SM), Boc Hong Kong (Holdings) Ltd. (TICKER: 2388 HK), Intesa Sanpaolo (TICKER: ISP IM), Nissan Motor Co (TICKER: 7201 JP), Naturgy Energy Group SA (TICKER: NTGY SM), Repsol Sa (TICKER: REP SM), Tokyo Electron (TICKER: 8035 JP), Aviva (TICKER: AV/ LN), Bae Systems Plc (TICKER: BA/ LN), Renault Sa (TICKER: RNO FP), Telia Co Ab (TICKER: TELIA SS), Wpp Plc (TICKER: WPP LN), Uni-President Enterprises (TICKER: 1216 TT), Danske Bank A/S (TICKER: DANSKE DC), Wh Group Ltd (TICKER: 288 HK), Nn Group N.V. (TICKER: NN NA), MOWI ASA (TICKER: MOWI NO), South32 Limited (TICKER: S32 AU), International Consolidated Airlines Group Sa (TICKER: IAG LN), Marubeni Corp (TICKER: 8002 JP), Cimic Group Ltd (TICKER: CIM AU), President Chain Store (TICKER: 2912 TT), Agl Energy Ltd (TICKER: AGL AU), H Lundbeck A/S (TICKER: LUN DC), RTL Group SA (TICKER: RRTL GR), China Resources Power Holdings Co. Ltd. (TICKER: 836 HK), Valeo (TICKER: FR FP), Qantas Airways Ltd (TICKER: QAN AU), China Resources Cement Holdings Ltd. (TICKER: 1313 HK), Nanya Technology Corp (TICKER: 2408 TT), Boc Aviation Ltd (TICKER: 2588 HK), Sainsbury (J) (TICKER: SBRY LN), Tui Ag (TICKER: TUI LN), Asr Nederland Nv (TICKER: ASRNL NA), Salmar Asa (TICKER: SALM NO), Faurecia (TICKER: EO FP), Lawson Inc (TICKER: 2651 JP), Catcher Technology Co Ltd (TICKER: 2474 TT), Yue Yuen Industrial (Holdings) Ltd. (TICKER: 551 HK), Easyjet (TICKER: EZJ LN), Nokian Tyres Plc (TICKER: TYRES FH), Andritz Ag (TICKER: ANDR AV), Scentre Group (TICKER: SCG AU).

The deletions from SNIDIV are: Royal Mail Plc (TICKER: RMG LN), Pegatron Corporation (TICKER: 4938 TT), Royal Dutch Shell A (TICKER: RDSA NA), Roche Hldgs Ag Ptg Genus (TICKER: ROG SW), Novartis Ag Reg (TICKER: NOVN SW), Anheuser Busch Inbev Nv (TICKER: ABI BB), Rio Tinto Ltd (TICKER: RIO AU), Enbridge Inc (TICKER: ENB CN), Axa (TICKER: CS FP), Sands China Ltd. (TICKER: 1928 HK), National Grid Plc (TICKER: NG/ LN), Anglo American Plc (TICKER: AAL LN), Hon Hai Precision Industry Co Ltd (TICKER: 2317 TT), Telstra Corp Ltd (TICKER: TLS AU), Nokia Oyj (TICKER: NOKIA FH), Aena SME SA (TICKER: AENA SM), Endesa Sa (TICKER: ELE SM), Formosa Plastics Corp (TICKER: 1301 TT), Seb-Skand Enskilda Banken A (TICKER: SEBA SS), Svenska Handelsbanken A (TICKER: SHBA SS), Ferrovial Sa (TICKER: FER SM), Fortescue Metals Group (TICKER: FMG AU), Carrefour Sa (TICKER: CA FP), Natixis (TICKER: KN FP), Insurance Australia Group Ltd (TICKER: IAG AU), Delta Electronic Ind (TICKER: 2308 TT), Jeronimo Martins & Filito Sgps (TICKER: JMT PL), Adecco Group AG Reg (TICKER: ADEN SW), Singapore Technologies Engineering Ltd (TICKER: STE SP), Recordati Spa Ord (TICKER: REC IM), Ica Gruppen Ab (TICKER: ICA SS), Persimmon (TICKER: PSN LN), Auckland Intl Airport Ltd (TICKER: AIA NZ), Unipolsai Assicurazioni Spa (TICKER: US IM), Igm Financial Inc (TICKER: IGM CN), Skanska Ab-B (TICKER: SKAB SS), Enagas Spa (TICKER: ENG SM), Medibank Private Limited (TICKER: MPL AU), Seiko Epson Corp (TICKER: 6724 JP), Marks & Spencer Group (TICKER: MKS LN), Kesko Oyj B (TICKER: KESKOB FH), Banca Mediolanum (TICKER: BMED IM), Casino Guichard-Perrachon (TICKER: CO FP), G4S Plc (TICKER: GFS LN), Prosiebensat.1 Media Se (TICKER: PSM GR), Bic (TICKER: BB FP), Unibail Rodamco Westfield (TICKER: URW NA).

More information can be found at www.snetglobalindexes.com.

 

Index: S-Network International Dividend Price Index TICKER: SNIDIV

 

Index: S-Network International Dividend Total Return Index TICKER: SNIDIVTR

22 Additions and 21 Deletions in S-Network Mid-Cap Dividend Index Annual Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The S-Network Mid-Cap Dividend IndexSM (TICKER: SNMDIV) will add 22 constituents and drop 21 constituents in its annual reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, changing the number of index components to 50.

The additions to SNMDIV are: Bruker Biosciences Corp (TICKER: BRKR US), Chemed Corp (TICKER: CHE US), Ingredion Inc (TICKER: INGR US), Lazard Ltd (TICKER: LAZ US), nVent Electric PLC (TICKER: NVT US), Jabil Inc (TICKER: JBL US), Wyndham Destinations Inc (TICKER: WYND US), Logmein Inc (TICKER: LOGM US), Umpqua Hldgs Corp (TICKER: UMPQ US), The Chemours Company (TICKER: CC US), Olin Corp (TICKER: OLN US), Pbf Energy Inc A (TICKER: PBF US), Kbr Inc (TICKER: KBR US), Goodyear Tire & Rubber Co (TICKER: GT US), GRAFTECH INTERNATIONAL LTD (TICKER: EAF US), John Wiley & Sons Inc. A (TICKER: JW/A US), Cabot Microelectronics Corp (TICKER: CCMP US), Terraform Power Inc A (TICKER: TERP US), Cogent Communications Holdings Inc (TICKER: CCOI US), Domtar Corp (TICKER: UFS US), AGNC Investment Corp (TICKER: AGNC US), New Residential Investment Corp. (TICKER: NRZ US).

The deletions from SNMDIV are: Leidos Holdings Inc (TICKER: LDOS US), Steris Plc (TICKER: STE US), Greif Bros Corp A (TICKER: GEF US), Vishay Intertechnology Inc (TICKER: VSH US), Triton International Ltd/Ber (TICKER: TRTN US), Booz Allen Hamilton Holding Corp A (TICKER: BAH US), Old Republic Intl Corp (TICKER: ORI US), Hubbell Inc (TICKER: HUBB US), Sonoco Products Co (TICKER: SON US), Bemis Co Inc (TICKER: BMS US), Williams-Sonoma Inc (TICKER: WSM US), Murphy Oil Corp (TICKER: MUR US), J2 Global Inc (TICKER: JCOM US), Tribune Media Co A (TICKER: TRCO US), United Bankshares Inc (Wv) (TICKER: UBSI US), Northwestern Corp (TICKER: NWE US), Timken Co (TICKER: TKR US), Telephone & Data Systems Inc (TICKER: TDS US), Energizer Holdings Inc (TICKER: ENR US), Two Harbors Investment Corporation (TICKER: TWO US), Colony Capital Inc (TICKER: CLNY US).

More information can be found at www.snetglobalindexes.com.

 

Index: S-Network International Dividend Price Index TICKER: SNMDIV

 

Index: S-Network International Dividend Total Return Index TICKER: SNMDIVTR

24 Additions and 24 Deletions in S-Network ADR Dividend Index Annual Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The S-Network ADR Dividend IndexSM (TICKER: ADRDX) will add 24 constituents and drop 24 constituents in its annual reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, maintaining the number of index components at 50.

The additions to ADRDX are: Vodafone Group ADR (TICKER: VOD UQ), Orange ADR (TICKER: ORAN UN), Nokian Renkaat Oyj ADS (TICKER: NKRKY US), Honda Motor Co ADR (TICKER: HMC UN), Cia Cervecerias Unidas (TICKER: CCU UN), J Sainsbury PLC ADS (TICKER: JSAIY US), Koninklijke Ahold Delhaize N.V. ADS (TICKER: ADRNY US), Transportadora de Gas del Sur SA (TICKER: TGS UN), Ecopetrol SA ADR (TICKER: EC UN), Repsol YPF S.A. ADS (TICKER: REPYY UV), Swedbank AB ADS (TICKER: SWDBY US), Societe Generale (France) ADS (TICKER: SCGLY US), BNP Paribas S.A. ADS (TICKER: BNPQY US), Bayer ADR (TICKER: BAYRY US), International Consolidated Airlines Group S.A. ADS (TICKER: ICAGY US), BAE Systems PLC ADS (TICKER: BAESY US), CK Hutchison Holdings ADS (TICKER: CKHUY US), Tokyo Electron Ltd. ADS (TICKER: TOELY US), Taiwan Semiconductor Manufacturing Co Ltd (TICKER: TSM UN), UPM Kymmene Oyj ADR (TICKER: UPMKY US), BASF SE ADR (TICKER: BASFY US), SOQUIMICH - Sociedad Quimica y Minera de Chile SA B ADR (TICKER: SQM UN), Red Electrica Corp. S.A. ADS (TICKER: RDEIY US), Enel Americas S.A. ADR (TICKER: ENIA UN).

The deletions from ADRDX are: WPP Plc ADR (TICKER: WPP UN), Telstra Corp. Ltd ADS (TICKER: TLSYY UV), Telecom Argentina SA ADR (TICKER: TEO UN), ProSiebenSat.1 Media SE ADR (TICKER: PBSFY US), WH Group Ltd ADR (TICKER: WHGLY US), Carrefour S.A. ADS (TICKER: CRRFY US), Anheuser Busch Inbev NV ADR (TICKER: BUD UN), BP ADR (TICKER: BP UN), Royal Dutch Shell PLC B ADR (TICKER: RDS/B UN), Ultrapar Participacoes S.A. ADR (TICKER: UGP UN), National Australia Bank Ltd ADS (TICKER: NABZY UV), Westpac Banking Corp ADR (TICKER: WBK UN), Commonwealth Bank of Australia ADS (TICKER: CMWAY US), Novartis AG ADR (TICKER: NVS UN), Grupo Aeroportuario del Pacifico, S.A.B. de C.V. ADR (TICKER: PAC UN), Siemens AG ADR (TICKER: SIEGY US), Grupo Aeroportuario Cen-Adr (TICKER: OMAB UQ), Cielo S/A ADS (TICKER: CIOXY US), Nokia OYJ ADR (TICKER: NOK UN), Braskem SA Prf A ADR (TICKER: BRKMY US), Rio Tinto Plc ADR (TICKER: RIO UN), BHP Group Plc ADR (TICKER: BBL UN), Enel S.p.A. ADS (TICKER: ENLAY US), Cia Energetica de Minas Gerais Prf ADR (TICKER: CIG UN).

The S-Network ADR Dividend Index (ADRDX) is a portfolio of fifty stocks derived from the BNY Mellon Composite Depository Receipt Index (ADR Index). The ADRDX methodology selects the five stocks in each of the ten GICS sectors that make up the ADR Index which offer the highest dividend yields as of the last trading day of May.

 

ADRDX is rules based and fully transparent, employing a methodology that weights all 50 index constituents equally. The index rules and methodology can be found by clicking here.

 

Index: S-Network ADR Dividend Index TICKER: ADRDX

 

Index: S-Network ADR Dividend Total Return Index TICKER: ADRDXTR

13 Additions and Eight Deletions in S-Network Tech Target Index Semi-Annual Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The S-Network Tech Target IndexSM (TICKER: SNTECH) will add 13 constituents and drop eight constituents in its semi-annual reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, changing the number of index components to 96.

The additions to SNTECH are: CARGURUS INC (TICKER: CARG US), Tenable Holdings, Inc. (TICKER: TENB US), ZUORA INC - CLASS A (TICKER: ZUO US), Eventbrite, Inc. (TICKER: EB US), Secureworks Corp - A (TICKER: SCWX US), Mobile Iron Inc (TICKER: MOBL US), Zix Corp. (TICKER: ZIXI US), Mitek Systems Inc (TICKER: MITK US), Usa Technologies  Inc (TICKER: USAT US), Amber Road Inc (TICKER: AMBR US), Telaria Inc (TICKER: TLRA US), Digital Turbine Inc (TICKER: APPS US), Rubicon Project Inc/The (TICKER: RUBI US).

The deletions from SNTECH are: Zynga Inc. A (TICKER: ZNGA US), Pegasystems Inc (TICKER: PEGA US), Realpage Inc (TICKER: RP US), Paylocity Holding Corp (TICKER: PCTY US), Appian Corp (TICKER: APPN US), Pros Holdings Inc (TICKER: PRO US), Net 1 Ueps Technologies Inc (TICKER: UEPS US), Everi Holdings Inc (TICKER: EVRI US).

SNTECH is a portfolio of small-cap stocks classified in several key GICS Sub-Industries relating to technology that pass screens for liquidity, net sales and sustainable cash burn rates.

 

SNTECH is rules based and fully transparent. More information can be found at www.snetglobalindexes.com.

 

Index: S-Network Small-Cap Technology Price Index TICKER: SNTECH

 

Index: S-Network Small-Cap Technology Total Return Index TICKER: SNTECHTR

One Addition and Two Deletions in Climate Advisers Better Palm Oil Index Quarterly Reconstitution

  • June 12, 2019
  • S-Network Global Indexes

New York, NY, Wednesday, June 12, 2019 — The Climate Advisers Better Palm Oil IndexSM (TICKER: CABPLM) will add one constituent and drop two constituents in its quarterly reconstitution, effective 6:00 PM (ET) Sunday, June 23, 2019, changing the number of index components to 17.

The addition to CABPLM is: KWANTAS CORP BHD (TICKER: KWAN MK).

The deletions from CABPLM are: BUMITAMA AGRI LTD (TICKER: BAL SP), LAM SOON (THAILAND) PCL (TICKER: LST TB).

The Climate Advisers Better Palm Oil Index (Ticker: CABPLM) is an equity index designed to serve as an equity benchmark for globally traded stocks of companies that are members of the Roundtable on Sustainable Palm Oil (RSPO).

 

More information can be found at snetglobalindexes.com.

 

Index: Climate Advisers Better Palm Oil IndexSM                         TICKER: CABPLM

 

Index: Climate Advisers Better Palm Oil Total Return IndexSM       TICKER: CABPLMT

The Efficacy of Indexation II (CEFMX — A Case Study)

  • June 04, 2019
  • S-Network Global Indexes

S-Network Composite Municipal Closed-End Fund Index

The S-Network Composite Municipal Bond Closed-End Fund Index (TICKER: CEFMX) comprises 63 closed-end funds that invest in municipal bonds. As of March 31, 2019, CEFMX was yielding approximately 4.9% per annum on a federally tax-free basis. It serves as the basis of an ETF offered by VanEck Market Vectors (TICKER: XMPT) which holds nearly $150 million in assets.

Why Municipal Bond Closed-End Funds

The most unique characteristic of CEFMX is the exposure it provides — municipal bond closed-end funds (MCEFs). As a result, the dividend income derived from CEFMX is free from federal income taxes.

But like its cousin CEFX, CEFMX offers a number of additional benefits. Because MCEFs are not required to make redemptions, they do not need to hold cash in reserve for such occasions. By the same token, they can invest in less-liquid securities, including private placements, which typically offer slightly higher yields and are less subject to the ups and downs of market turbulence.

Most MCEFs are actively managed, which is another important characteristic, because the managers employ proprietary investment strategies aimed at enhancing yield. Many MCEFs employ leverage, whereby they borrow against their assets to buy additional assets in order to enhance yield.

A possible downside of MCEFs is that they often trade at discounts to their NAVs. These discounts occur precisely because the MCEFs do not offer redemptions at their NAVs. But there is also opportunity to be found in these discounts. In turbulent markets, the discounts tend to widen. But then, when market stability is restored, the discounts tend to narrow. Buying MCEFs at a discount actually increases the yield on their market prices and can provide additional return when discounts narrow.

CEFMX discounts premiums chart

Diversifying Risk

The biggest problem with MCEFs, however, is the age-old investment problem of picking the right MCEF to include in one’s portfolio. A MCEF that cuts its dividend, for example, is likely to experience a decline in price, thus negating the higher yield that the MCEF might have provided.

The main benefit of CEFMX is the diversification it offers. The portfolio currently consists of 63 individual MCEFs, managed by 14 of the most prominent asset managers in active municipal bond investing, such as BlackRock, Nuveen, Invesco and Eaton Vance. Each manager employs their own unique investment strategy.

Constituent weights in CEFMX are capped at 8%, so individual MCEF risk is substantially mitigated. Of course, diversification comes at a price. It is certainly possible to get lucky, pick a single MCEF and enjoy a slightly higher yield than CEFMX offers. That is a personal decision based on risk preferences and the analytic resources at one’s disposal.

CEFMX Manager Distribution Chart CEFMX Sector Distribution Chart

Constituents Chosen Based on Objective Criteria

As a composite index, CEFMX includes every US-listed MCEF with AUM greater than $100 million that fits into its selection criteria. Further screens are applied to define criteria for liquidity, expense ratio and discount/premium to NAV. The index rules governing all of the factors that are applied to the selection of constituent funds provide another valuable dimension of risk mitigation.

Index performance can be compromised, however, through high levels of turnover. This is especially true in the MCEF market, where liquidity is often limited. To deal with this factor, CEFMX employs buffers that prevent high turnover rates related to its semi-annual reconstitutions. For example, an MCEF constituent must have at least $100 million in AUM to be selected for inclusion in CEFMX, but once in the index, the constituent’s AUM must fall below $90 million to be dropped from the index. Similar buffers for liquidity criteria are also applied. As a result, CEFMX has maintained very low turnover rates throughout its history, thereby mitigating performance drag.

Importantly, MCEFs with high expense ratios are excluded from the index, using a dynamic threshold based on the 30-day LIBOR. This keeps the expense ratios — including the cost of leverage — from exceeding industry norms by an excessive amount.

Capitalizing on Discounts

The CEFMX rules for selection produce a dependable and cost-efficient index. Rules governing the weightings of CEFMX constituents are also applied. Unlike most stock market indexes, which weight constituents based on their market capitalizations, CEFMX weights its constituents based on their Total Net Assets. Since most MCEFs trade at a discount to NAV, this weighting methodology produces a more accurate representation of the holdings while a traditional market cap weighting would favor MCEFs selling at premiums or rich relative valuations.

CEFMX also builds a smart beta component into its weighting methodology. Simply put, weights are adjusted (at quarterly rebalancing) to give the CEFs with the highest discounts the highest weights and to reduce the weights of CEFs trading at a premium to NAV. This is a technique often used by professional CEF investors, because CEFs trading at a discount tend to revert to the mean.

CEFMX Discount Threshold chart

What Does It All Mean

The overall architecture of CEFMX uses custom rules-based indexing methodology to capitalize on the advantages inherent in MCEFs, while diminishing the impact of their flaws. The resulting characteristics of CEFMX offer broad diversification, in terms of jurisdictional exposure and quality, which tilts strongly toward investment grade.

As of March 31, 2019, the highest single-state exposure in CEFMX was to Illinois at 11.72%, followed by California at 10.18% and Texas at 9.67%. Exposure to Puerto Rico was a mere 0.73%.

CEFMX State Distribution Chart Furthermore, CEFMX maintains high standards of credit quality, with approximately 64% of the underlying holding maintaining credit ratings of A, AA or AAA.

CEFMX Credit Quality Distribution Chart

Conclusion

CEFMX is a composite index, including all the municipal bond closed-end funds that meet its general listing, size and liquidity requirements. The index does not limit the components that may come from a particular municipality or manager, nor does it pick them based on the highest yield. CEFMX instead casts a wide net, maintaining representation of the bulk of the US municipal bond market, and improves performance using its weighting methodology, which modifies the net-asset weighting of the closed-end funds according to their discounts or premiums.

Perhaps most importantly, CEFMX is not a municipal bond index per se. A municipal bond index would hold individual municipal issues chosen in a mechanistic way. Such an approach might leave one vulnerable to spikes in interest. Because each of the underlying MCEF constituents of CEFMX is actively managed, interest rate risk is addressed, thereby providing some added degree of protection.

The Efficacy of Indexation (CEFX—A Case Study)

  • April 06, 2019
  • S-Network Global Indexes

Over the past twenty years indexation has expanded its share of the asset management market relentlessly. Driven in large part by the advent of ETFs, the characteristics of indexation have changed markedly throughout this growth period.

There are some 2,234 exchange-traded products listed with approximately $3.77 trillion in assets under management (AUM)[1]. Of these, over one thousand niche indexes, including single and multi-sector, country, thematic, single and multi-factor, and commodity ETFs held well over one trillion dollars in total assets.

Smart Beta ETFs and ETPs, which embrace a number of the aforementioned categories garnered 10.1% growth in the month of January 2019 alone and total assets now exceed $700 billion. This marked the 36th consecutive month of net inflows into Smart Beta exchange-traded products[2].

Below is a general breakdown of the ETF industry:

CEFX ETF Table

In many respects, these niche indexes provide desired exposures that, when integrated into a diversified portfolio, provide opportunity to enhance performance and diminish risk.

To illustrate the benefits of niche indexes, we would like to examine the specific characteristics of the S-Network Composite Closed-End Fund Index (CEFX). CEFX comprises a total of 135 individual closed-end funds that offer high dividend payouts. As of March 31, 2019, the index was yielding approximately 7.9% per annum and served as the basis of an ETF offered by Invesco PowerShares — the Invesco CEF Income Composite ETF (PCEF) which holds over $700 million in assets.

Why Closed-End Funds

The most unique characteristic of CEFX lies in the exposure it provides — Closed-End Funds (CEFs). Closed-end funds are 40-Act mutual funds that trade on recognized stock exchanges. Altogether, CEFs hold approximately $275 billion in assets[3], with roughly 60% pursuing yield-oriented strategies, including fixed income and covered call writing. Unlike ETFs, CEFs are closed to fresh contributions and redemptions. Capital held by CEFs is permanent, which gives CEFs a tactical advantage over open-end mutual funds, which offer daily contributions and redemptions at the funds’ Net Asset Values (NAVs).

For example, because CEFs are not required to make redemptions, they needn’t hold cash in reserve for such occasions. By the same token, they can invest in less-liquid securities, which in the case of bonds may be held to maturity, making them less subject to the ups and downs of market turbulence. Most CEFs are actively managed, which is another important characteristic, because the managers may employ proprietary investment strategies aimed at enhancing yield. Many CEFs employ leverage whereby they borrow against their assets to buy additional assets in order to enhance yield.

A possible downside of CEFs is that they often trade at discounts to their NAVs. These discounts occur precisely because the CEFs do not offer redemptions at their NAVs. But there is also opportunity to be found in these discounts. In turbulent markets, the discounts tend to widen. But then, when market stability is restored, the discounts tend to narrow. However, buying yield oriented funds at a discount actually increases the yield on their market prices and can provide additional returns when discounts narrow.

Diversifying Risk

The biggest problem with CEFs, however, is the age-old investment problem of picking the right CEF to include in one’s portfolio. A CEF that cuts its dividend, for example, is likely to experience a decline in price, thus negating the higher yield that the CEF may have provided.

The chief benefit of CEFX is the diversification it offers. Since CEFX contains 135 separate CEFs, an investor seeks higher yield by employing 42 separate management companies, including many of the most prominent names in the asset management industry, such as BlackRock, Eaton Vance and Nuveen.  Each manager employs their own unique investment strategy. Simply put, it would strain credulity to believe that 42 different managers — all highly skilled and supported by sophisticated data and analytic systems — could all get it wrong at the same time.

But the diversification principles that underlie CEFX do not stop with managers. Included in CEFX are 41 funds that specialize in investment-grade fixed income, 59 funds that specialize in high-yield fixed income, and 35 funds that pursue option income or covered call strategies. Included in this diversified investment mix are certain high-yielding instruments that fit well into the CEF structure, such as bank loans, emerging-market bonds and, in the case of option income CEFs, global stocks.

This diversification policy is built into the rule set of CEFX, so that individual CEF risk is substantially mitigated. Of course, diversification comes at a price. It is certainly possible to get lucky, pick a single CEF and enjoy a slightly higher yield than CEFX offers. That is a personal decision based on risk preferences and the analytic resources at one’s disposal.

Constituents Chosen Based on Objective Criteria

As a composite index, CEFX includes every US-listed CEF over a certain size — AUM greater than $100 million — that fits into its sector selection criteria. Further screens are applied to define criteria for liquidity, expense ratio and discount/premium to NAV. The index rules governing all of these factors that are applied to the selection of constituent funds provide another valuable dimension of risk mitigation.

Index performance can be compromised, however, through high levels of turnover. This is especially true in the CEF market, where liquidity is often limited. To deal with this factor, CEFX employs buffers that prevent high turnover rates related to its quarterly reconstitutions. For example, a CEFX constituent must have $100 million in AUM to be selected for inclusion in the index, but once in the index, the constituent’s AUM must fall below $75 million to be dropped from the index. Buffers for liquidity are also applied. As a result, CEFX has maintained very low turnover rates throughout its history, thereby mitigating performance drag.

Importantly, CEFs with high expense ratios are excluded from the index, using a dynamic threshold based on the 30-day LIBOR. This keeps the expense ratios — including the cost of leverage — from exceeding industry norms by an excessive amount.

Capitalizing on the Discount

The CEFX rules for selection produce a dependable and cost-efficient index. Rules governing the weightings of CEFX constituents are also applied. Unlike most stock market indexes, which weight constituents based on their market capitalizations, CEFX weights its constituents based on their Total Net Assets. Since most CEFs trade at a discount to NAV, this weighting methodology produces a more accurate representation of the holdings while a traditional market cap weighting would favor CEFs selling at premiums or rich relative valuations

CEFX also builds a smart beta component into its weighting methodology. Simply put, weights are adjusted (at quarterly rebalancings) to give the CEFs with the highest discounts the highest weights and to reduce the weights of CEFs trading at a premium to NAV. This is a technique often used by professional CEF investors, because CEFs trading at a discount tend to revert to the mean.

What Does It All Mean?

The overall architecture of CEFX uses custom rules-based indexing technology to capitalize on the advantages inherent in CEFs, while diminishing the impact of their flaws. Accordingly, CEFX is complex from a methodological standpoint. But what is the result of all the complexity?

CEFX offers a yield of approximately 7.9% in an environment where yields over 3% are persistently hard to attain.

CEFX is but one example of how indexation can provide important disciplines to improve performance and mitigate risk. At S-Network, we have developed a number of indexes that rank among the best performers in their respective sectors. Many S-Network indexes mirror the best investment practices of leading active managers, only without the subjectivity.

With the recent growth of SMA platforms, indexes create a new opportunity set for growth. When integrated into a financial practice, custom indexes can help financial strategists and wealth managers build a solid platform for generating success.

[1] Source: www.etfaction.com, accessed March 28, 2019

[2] Source: https://finance.yahoo.com/news/etf-trends-seen-10-old-180006268.html

[3] Source: https://www.ici.org/pdf/per24-02.pdf

 

About S-Network Global Indexes

S-Network Global Indexes, Inc. is a publisher and developer of proprietary and custom indexes. S-Network began publishing indexes in 2006 and currently publishes over 300 indexes, which serve as the underlying portfolios for financial products with approximately USD 7 billion in assets under management. S-Network indexes, which are supported by a state-of-the-art technology platform, are known for their transparency and efficiency.

S-Network Benchmark Indexes Now Available on FactSet

  • April 02, 2019
  • S-Network Global Indexes

April 2, 2019 (New York, NY)- S-Network Global Indexes today announced that the S-Network US Equity Benchmark Index Series (w/REITS) is now available within FactSet’s suite of analytics solutions.

The S-Network benchmark series is a full suite of indexes that provide historical daily performance starting in 1999. All data used to compile the indexes has been carefully scrubbed and rules have been applied meticulously since 1999 to define precise data sets.

The US Benchmark Series embraces over 3500 stocks domiciled and traded in the US and includes the following core indexes:

  • S-Network US Equity Large Cap 500 Index (S-Net 500)
  • S-Network US Equity 3000 Index (S-Net 3000)
  • S-Network US Equity Large/Mid-Cap 1000 Index (S-Net 1000)
  • S-Network US Equity Small Cap 2000 (S-Net 2000)

Growth and value indexes based on the S-Net 1000 and S-Net 2000 will be integrated into FactSet in the near future.

"We are proud to enter into this arrangement with FactSet, which has integrated the S-Net benchmarks into its state-of-art analytics suite,” says Joseph LaCorte, CEO of S-Network.

"We set out to provide a low-cost alternative to the major benchmarks,” says Patrick Shaddow, S-Network’s Head of Index Operations. “S-Network's benchmarks employ consistent and transparent methodologies and maintain high correlations to the recognized benchmarks."

The S-Network benchmarks are fully transparent and entirely rules based, thereby enhancing their functionality in analytic processes.

Extensive information about the full S-Network Benchmark Series, which includes a comprehensive suite of international and emerging markets benchmarks, as well as US REITS and MLPs, is available at www.snetbenchmarkindexes.com. Daily index values starting in 1999 may be downloaded for any of the 200 indexes in the family free of charge on the site.

S-Network Appointed as Calculation Agent by Impax Asset Management for Impax Global Women’s Leadership Index

  • February 25, 2019
  • S-Network Global Indexes

February 25, 2019 (New York, NY) - S-Network Global Indexes today announced that it has been appointed as calculation agent for the Impax Global Women’s Leadership Index by Impax Asset Management LLC.

The Impax Global Women’s Leadership Index is a customized index of the highest-rated companies in the world for advancing women, as rated by Impax Gender Analytics, that also meet key environmental, social and governance (ESG) standards.

S-Network will perform routine daily index calculations and index maintenance (e.g., quarterly rebalancing, and corporate actions) for this index.

“We are honored to have been selected by Impax Asset Management, a leader in sustainable investing,” said Joseph LaCorte, CEO of S-Network.

“We’re pleased to begin working with S-Network,” said Joe Keefe, President of Impax Asset Management. “Their services will help our gender analytics team keep a sharp eye on this novel index.”

About Impax Asset Management LLC

Impax Asset Management LLC, formerly Pax World Management LLC, is a pioneer in the field of sustainable investing. Impax offers a diverse lineup of strategies focused on the risks and opportunities arising from the transition to a more sustainable global economy. Each strategy integrates environmental, social and governance (ESG) research into the investment process to better manage risk and deliver competitive long-term investment performance. Since 1971, Impax has made it possible for investors to pursue financial returns while having a positive social and environmental impact.

About S-Network Global Indexes

S-Network Global Indexes, Inc. is a publisher and developer of proprietary and custom indexes. Founded in 1997, S-Network publishes over 300 indexes, which serve as the underlying portfolios for financial products with over USD 7 billion in assets under management. S-Network indexes, which are supported by a state-of-the-art technology platform, are known for their transparency and efficiency.

S-Network Partners with Newday Impact Investing to Launch First Suite of Indexes Targeting UN Sustainable Development Goals (SDGs)

  • June 27, 2018
  • S-Network Global Indexes

New York, NY (June 27, 2018) — S-Network Global Indexes announced that it has partnered with Newday Impact Investing on their launch of the “Newday Impact Investing iOS App.” The app is now available for download at the App Store and will be available soon on Google Play. Accounts may be established with as little as $5.
 
S-Network assisted Newday in creating three new indexes that address the UN Sustainable Development Goals (SDGs).  The first group of indexes addresses ocean health and clean water, renewable energy and reduced greenhouse gas emissions, and gender equality. Additional indexes will be constructed later this year.
 
The Sustainable Development Goals (SDGs), otherwise known as the Global Goals, are a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity. The 17 Goals address areas such as climate change, economic inequality, innovation, sustainable consumption, peace and justice, among other priorities.
 
“We're proud to partner with a progressive organization that values transparency and digestible impact investment solutions. Investors see a new opportunity to invest for their future goals with profits and impact in mind,” said Joseph LaCorte, CEO of S-Network.
 
“The SDGs are arousing investors who want to make their investment savings connect with their personal or ethical values. These investors see an impact link between the SDGs and their investing objectives,” said Gregg Sgambati, Head of ESG at S-Network.


"We are pleased to have S-Network as an important partner in the development process of our indexed based strategies. We view S-Network as a leading provider of data solutions and index construction services. They’ve allowed us to accelerate the delivery of our proprietary thematic based strategies and be agile in an area that’s complex and continues to evolve,” said Doug Heske, CEO of Newday.

S-Network Global Indexes Inc. 

S-Network Global Indexes, Inc. is a publisher and developer of proprietary and custom indexes. S-Network began publishing indexes in 2006 and currently publishes over 300 indexes, which serve as the underlying portfolios for financial products with approximately USD 7 billion in assets under management. S-Network indexes, which are supported by a state-of-the-art technology platform, are known for their transparency and efficiency. For more information, visit http://snetworkglobalindexes.com/
 
Newday Impact Investing

Based in San Francisco, Newday is a technology-enabled asset manager that provides affordable, transparent and easy-to-understand impact investment solutions to the mass market. By investing in socially responsible and sustainable companies, Newday aims to generate competitive return and, most importantly, drive meaningful change in the way companies in our portfolios adopt environmental, social and governance (ESG) practices and policies. In order to be effective in driving positive impact on corporate behavior, Newday adopts an active ownership model, engaging with companies' decisions as they affect their stakeholders including communities, employees and shareholders. For more information, visit https://www.newdayimpact.com/
 

S-Network Expands Direct Index Lineup with SMArtX

  • May 08, 2018
  • S-Network Global Indexes

May 8, 2018 (New York, NY) — S-Network Global Indexes, Inc. is pleased to announce a second round of indexes available for direct investment on SMArtX Advisory Solutions’ Turnkey Asset Management Platform (TAMP).

Included in this offering are the following indexes:

  • S-Network International Dividend Yield ADR Index
  • S-Network Deep Value Index
  • S-Network Option Income Closed End Fund Index
  • S-Network High Yield Fixed Income Closed End Fund Index
  • S-Network Bank Loan/Short Duration Closed End Fund Index and
  • S-Network Investment Grade Fixed Income Closed End Fund Index

In addition, thematic indexes being offered include the S-Network Natural Resources Liquid Index, which encompasses the largest and most liquid US-traded companies engaged in natural resource industries as well as the S-Network Tech Takeover Targets Index, which isolates small-cap technology stocks that may be attractive takeover targets.

S-Network and SMArtX began their partnership on February 15, 2018 to provide Registered Investment Advisors with a variety of low cost, smart beta and thematic indexes for direct investment.  The newest additions provide exposure across a range of investment opportunities that offer yield, international exposure and important themes.

One of the initial indexes offered, the S-Net US Equity Large Cap 500 Index, is available free of charge exclusively on SMArtX.

About S-Network Global Indexes
S-Network Global Indexes, Inc. is a publisher and developer of proprietary and custom indexes. Founded in 2006, S-Network publishes over 300 indexes, which serve as the underlying portfolios for financial products with over USD 8.5 billion in assets under management.  S-Network is dedicated to developing indexes that define, isolate and measure the performance of discrete segments of the new global economy on a rules-based, transparent basis.  For more information, visit http://snetglobalindexes.com/.
 
About SMArtX Advisory Solutions
SMArtX Advisory Solutions is the next generation turnkey asset management platform and the only platform to seamlessly offer traditional, alternative, and passive direct index strategies in a unified managed account structure. The firm also uses its proprietary trading and managed accounts technology to power SMArtX, SS&C Advent’s integrated unified managed account solution. For more information, visit http://www.smartx.us