IISL launches 4 new indices to track government securities

India Index Services & Products Limited (IISL), an NSE group company, today launched four new fixed income indices to track government securities (G-Secs).

The indices -- Nifty 15 year and above G-Sec index, Nifty Composite G-sec index, Nifty 4-8 year G-Sec index and Nifty 11-15 year G-Sec index-- are aimed at providing benchmarks across government securities tenors.

"These total return indices will consider price movement of securities and accrued interest income on a daily basis. The base date of these indices is January 3, 2011 and base value is 1,000," IISL said in a statement.

The new government securities indices along with existing G-sec indices would cover various maturities on the yield curve.

This will make it easy to track the performance of G-sec in various maturity buckets. The asset management companies may use these indices for launching G-Sec ETFs, index funds or as a benchmark for their funds. The indices will be calculated on an end-of-day basis.

These indices are constructed using the prices of top three (in terms of traded value) liquid Government of India bonds with the given residual maturity and having outstanding issuance more than Rs 5,000 crore, the statement noted.

The individual bonds are assigned weights based on the traded value and outstanding issuance in the ratio of 40:60, it added.