Markit, the leading provider of independent data, portfolio valuations and OTC derivatives trade processing to the global financial markets, today announced it has started publishing index levels for the GEMX (1), a family of benchmark indices referencing emerging market debt denominated in local currencies.
In February 2008, IFC, a member of the World Bank Group, announced the selection of Markit to develop a transparent index of emerging market local currency bonds. The index serves as a benchmark for the World Bank Group's Gemloc program, an initiative designed to help emerging market countries attract more investment and develop their local currency bond markets.
As part of Gemloc, the World Bank Group selected PIMCO to develop and manage investment strategies that will promote institutional investment in the local currency bonds of emerging market countries.
Stephan Flagel, Managing Director and Head of Indices at Markit, said: "GEMX reflects the broad emerging markets while taking into account investability factors. It is independent, fully transparent and objective and we expect the index to become the benchmark for local currency emerging market debt and to attract global investors to this fast growing asset class."
"The Gemloc program is designed to develop the local currency bond markets in emerging economies, and the GEMX index is an important part of that process. We are honored to be a part of the Gemloc program alongside Markit and the other Gemloc participants, and look forward to helping make the initiative a success," said Lori Whiting, Senior Vice President and Emerging Markets Product Manager at PIMCO.
All rules governing index membership and weightings are rules-based and publicly available. Published investability criteria, determined by CRISIL, in collaboration with IFC, are used to determine final country weightings.
The GEMX currently comprises twenty countries. Additional countries are expected to be included in the index later this year.
|Region||Countries||Weight %||Duration||No of bonds|
|Asia||China, India, Indonesia, Malaysia, Philippines, Thailand||31||4.83||90|
|Emea||Hungary, Poland, Russia, Slovakia, Turkey, Egypt, Morocco, Nigeria, South Africa||44||4.15||118|
|LatAm||Brazil, Chile, Columbia, Mexico, Peru||25||4.0||49|
(1) GEMX stands for the Markit iBoxx Global Emerging Markets Local Currency Bond Index in cooperation with IFC.