NEW YORK, June 5, 2012 /PRNewswire/ -- S&P Indices announced today the launch of the S&P Enhanced Yield North American Preferred Index which tracks 50 of the highest yielding securities in the North American preferred stock market. The Index has been licensed to Global X Funds to serve as the basis for a planned ETF.
The S&P Enhanced Yield North American Preferred Index is comprised of 50 of the highest yielding U.S. and Canada traded preferred stocks that meet criteria relating to size, liquidity and exchange listings. The underlying universe for the Index is all preferred securities in the S&P/TSX Preferred Share Index and S&P U.S. Preferred Stock Index.
Preferred stocks are a class of securities that combine the characteristics of debt and common stocks. While their expected volatility and returns fall between those of common stocks and bonds, their yields are typically higher. With low correlations to common stocks and bonds, they can serve as good diversification instruments.
"The S&P Enhanced Yield North American Preferred Index is an important addition to our closely followed family of preferred stock indices," says Michael Kondas, Associate Director at S&P Indices. "The Index fills a need in the industry for a more concentrated basket of preferred stocks that could potentially provide greater yields for investors seeking higher investment income."
"We are very excited to be launching an ETF based upon the S&P Enhanced High Yield North American Preferred Index," says Bruno del Ama, CEO at Global X Funds. "S&P Indices is an innovator and leading provider of preferred stock indices, and this index expands their offerings to an important segment of the preferred market."
Preferred stocks issued by a company to meet its capital or financing requirements are eligible for inclusion to the S&P Enhanced Yield North American Preferred Index. These include floating and fixed rate preferreds, cumulative and non-cumulative preferreds, preferred stocks with a callable or conversion feature and trust preferreds. Preferred stocks with total market capitalization of more than US$ 250 million and that have traded a three-month average daily value traded of US$ 1 million are eligible for inclusion.
For more information on the S&P Enhanced Yield North American Preferred Index, please visit: www.standardandpoors.com/indices
About S&P Indices
S&P Indices, a leading brand of the McGraw-Hill Companies (NYSE:MHP), maintains a wide variety of investable and benchmark indices to meet an array of investor needs. Over $1.45 trillion is directly indexed to our indices, which includes the S&P 500, the world's most followed stock market index, the S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, the S&P Global BMI, an index with approximately 11,000 constituents, the S&P GSCI, the industry's most closely watched commodities index, and the S&P National AMT-Free Municipal Bond Index, the premier investable index for U.S. municipal bonds. For more information, please visit: www.standardandpoors.com/indices.
It is not possible to invest directly in an index. S&P Indices does not sponsor, endorse, sell, or promote any S&P index-based investment product. This document does not constitute an offer of services in jurisdictions where S&P Indices or its affiliates do not have the necessary licenses. S&P Indices receives compensation in connection with licensing its indices to third parties.
SOURCE S&P Indices