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NSE launches dynamic asset allocation indices to combine equity, debt

The two indices are -- Nifty 50 & short duration debt -Dynamic P/E index and Nifty 50 & short duration debt Dynamic P/B index

Press Trust of India  |  New Delhi 

On July 4, Sebi had served fresh show cause notices to NSE and over 20 others for alleged violation of norms

Indices Monday said it has launched two indices, which are designed to tactically combine equity and debt.

The two indices are -- & short duration debt -Dynamic P/E index and & short duration debt Dynamic P/B index, Indices, an group company, said in a statement.

Within these indices, the between debt and equity is dynamically managed based on a model that compares the current price-earnings ratio (P/E) or price-book ratio (P/B) with historical P/E or P/B ratio of in the previous seven years.

"The two newly launched Nifty indices employ a dynamic, rule-based asset allocation mechanism, designed to tactically combine equity and debt.

"The unique asset allocation model alters the index's exposure to equity based on whether equity market presently appears to be relatively expensive or cheaper, thereby optimising the risk-return ratio for investors," said Mukesh Agarwal, CEO, Ltd.

He further said that these indices also appropriately fill the gap due to the absence of a relevant benchmark for performance comparison of the popular category offered by mutual funds in the country.

First Published: Mon, October 01 2018. 15:45 IST
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