With the guidance and direction of FTSE Russell’s independent practitioner committees, FTSE Russell regularly consults the market on changes to the methodology of its indexes to ensure that the indexes continue to meet investors’ requirements and define and lead global standards in indexing. The proposals set out in the various consultation documents are included in order to gather valuable market feedback and may or may not result in changes to FTSE Russell methodologies.
FTSE Russell, the European Public Real Estate Association (EPRA) and the National Association of Real Estate Investment Trusts (Nareit) proposed clarifications to the calculation of eligible EBITDA to Appendix 7 of the Ground Rules of the FTSE EPRA Nareit Global Real Estate Index Series. These clarifications reflect current operational practice and do not affect the composition of the indexes.
Note F – Where General and Administrative, Corporate, Overhead or other operating expenses are not clearly allocated to any of the reporting segments in the annual report, the model considers a proportionate allocation based on the revenue breakdown of the different operating segments.
Note G – Any share of Net Operating Income from property funds managed by the company is considered eligible income if appropriate disclosure is provided in terms of the nature of the fund, the percentage of company ownership in a fund, and adequate provision of a breakdown of operational income. Any profit/loss arising from property revaluations, fair value adjustments and management fees will be excluded.
A distinguishing feature of multi-currency fixed income benchmarks is their approach to local market inclusion. There are a number of dimensions across which global markets can be evaluated to establish how they are represented as peer groups in broad-based benchmarks. These can include market size, credit rating, asset-type, designation as an emerging or developed market, and degree of market accessibility.
Users of global fixed income benchmarks require a robust and transparent framework for evaluating such local market inclusion considerations that can be applied to both flagship and bespoke benchmark construction. To provide the necessary foundation and enhance our benchmarking approach, this consultation proposed a robust and transparent scoring system to assign a “Market Accessibility Level” for local government markets. Given the proposed annual nature of the review for Market Accessibility Levels, FTSE Russell also solicited user preferences for a continual versus annual application of the objective market size and credit rating criteria for local market inclusion in flagship indexes once the accessibility framework is formally adopted.
As part of FTSE Russell's commitment to ensuring that our benchmarks remain representative of the markets they are intended to track and continue to address the needs of index users, market participants were consulted on several topics related to the securitized products market. In particular, feedback was solicited relating to how our mortgage benchmarks reflect the evolution of the agency mortgage backed securities market and the Single Security Initiative.
Please use the following link to access a summary of the results from this consultation: Summary Consultation Results