Wednesday, October 12, 2011

Financial Products News #2011 - 60
NASDAQ OMX to Launch New Family of U.S. Treasury Fixed Income Indexes on Global Index Watch Effective November 8, 2011

What is the U.S. Treasury Fixed Income Index Family?

The U.S. Treasury Fixed Income indexes are a transparent and broad measure of the U.S. Treasury Note and Bond market, providing a unique view into the active U.S. debt issuance market via a daily rebalance methodology.

The indexes offer several advantages over indexes that rebalance monthly, including:

• improved timeliness
• better accuracy
• truer reflection of the actual state of the U.S. Treasury market as of the previous close
• smoother returns
• history dating back to December 31, 1998

The index family consists of the RBC Insight TRUST Overall U.S. Treasury Index (NQUSTAG) plus ten sub-indexes separated by term. In addition, NASDAQ OMX and PC-Bond offer stripped versions of the 11 indexes to exclude stripping of securities. Returns are calculated and components are rebalanced daily by PC-Bond and are weighted by market capitalization with pricing provided by RBC Capital Markets New York, a recognized Primary Dealer of U.S. Treasury issues.

By utilizing an objective and rules-based methodology, the U.S. Treasury Fixed Income offering exemplifies the NASDAQ OMX Global Index Group’s commitment to index transparency. Moreover, with this partnership, NASDAQ OMX and PC-Bond will leverage our mutual strengths to provide an accurate, timely and investable benchmark for the U.S. Treasury space thereby benefiting investors in what we believe is an under-served market segment.

What are the benefits of this product offering?

The U.S. Treasury family of indexes from NASDAQ OMX and PC-Bond distinguish themselves on multiple fronts, including:

• Data Quality: Partnering with a premier fixed income provider, PC-Bond, and utilizing an objective and rules-based methodology ensures index transparency.
• Flexibility & Ease of Access: NASDAQ OMX is the market leader in digital data delivery and this product will continue that tradition of excellence. The GIW product (of which this index family is a part) will be delivered on multiple platforms and also via the ftp mechanism.
• Affordability: The entire package – including history going back to December 31, 1998 – is aggressively priced keeping clients’ needs in mind.
• Methodology: The index family uses the daily valuation and rebalancing methodology, providing:
  • greater accuracy
  • timely data
  • smoother performance
  • greater insight into actual supply

In many ways – including content, methodology, pricing and ease of access – this new product offering distinguishes itself from the rest of the marketplace due to its combined emphasis on value and excellence.

When will NASDAQ OMX begin disseminating the U.S. Treasury Fixed Income indexes?

Effective Tuesday, November 8, 2011, NASDAQ OMX will enhance the existing GIW Fixed Income offering to support a new entitlement for the U.S. Treasury family of indexes. NASDAQ OMX’s premier delivery service for weightings data, GIW, is the only direct source for the U.S. Treasury Fixed Income data.

How will the indexes be disseminated?

NASDAQ OMX will offer a new U.S. Treasury Fixed Income entitlement on GIW to support these new indexes via a secure website interface and web service.

Additionally, we expect that this new entitlement will be offered via our redistribution partners.

What are the indexes?

For a list of the new indexes that will be available via GIW, please click here.

Will historical data be available?

Historical data for all indexes dating back to December 31, 1998 will be available to subscribing customers via the secure website interface and web service.

Upon initial release, historical constituent data will be available from September 1, 2011 and forward. In the near-future NASDAQ OMX will supplement the historical data offering to include constituent level data back to December 31, 1998.

When will test data be available?

Approved customers can access all historical data and daily files immediately.

Where can I find the GIW Web Service Specification document?

For more information about the secure web service offering supporting the U.S. Treasury Fixed Income indexes, click here.

How can I order?

For new NASDAQ OMX customers that wish to subscribe to the U.S. Treasury Fixed Income index offering, the following forms must be completed:

• NASDAQ OMX Global Data Agreement
• System Application
• New Data Feed Request Form (print copy) or via the Online Data Feed Request webpage

For existing NASDAQ OMX customers, the following form must be completed:

• New Data Feed Request Form (print copy) or via the Online Data Feed Request webpage

For access to the U.S. Treasury Fixed Income index offering via a vendor controlled terminal the following form must be completed:

• Global Index Watch Approval Request Form

How much will the data cost?

For those interested in subscription pricing information, please contact the Global Data Sales team at +1 301 978 5307 or +45 33 93 33 66.

Who is PC-Bond?

As a division of TMX Group, PC-Bond has been providing the benchmark performance standards for Canadian fixed income investments since 1947. The group has been the market leader in the Canadian Government Debt segment for the past several decades. PC-Bond’s flagship product, the DEX Universe Bond Index, is the broadest and most widely-used measure of performance for marketable government and corporate bonds outstanding in the Canadian market and utilizes an analogous daily rebalance transparent methodology.

Where can I find additional information?

• Refer to the Global Index Watch Website
• Refer to the U.S. Treasury Fixed Income Family fact sheet.
• Refer to the U.S. Treasury Fixed Income Index Frequently Asked Questions document.
• For GIW subscription information, contact NASDAQ OMX Global Data Sales at +1 301 978 5307 or +45 33 93 33 66.
• For product-related inquiries, contact NASDAQ OMX Global Data Products at +1 301 978 5307 or +45 3393 3366.
• For index licensing opportunities, contact the NASDAQ OMX Global Index Group.
• For information about PC-Bond, please visit the PC Bond website.