Dow Jones Indexes and AIG Financial Products Corp. have launched three new versions of the Dow Jones–AIG Commodity Index.
The Dow Jones–AIG Commodity Forward Indices will allow investors to measure exposure to longer-dated commodity futures contracts. The DJ-AIG Commodity Index 1 Month Forward, the DJ-AIG Commodity Index 2 Month Forward, and the DJ-AIG Commodity Index 3 Month Forward were created as tools for investors who have begun to seek increasingly sophisticated tools to manage their commodity investments as they move a portion of their exposure into longer-dated commodity futures, the firms said.
The new indexes are constructed according to the rules of the DJ-AIGCI and represent the index composition one, two, and three months into the future. For example, in July, the DJ-AIG Commodity Index 1 Month Forward includes those commodity futures contracts that will be in the DJ-AIGCI in August. Similarly, the 2 and 3 Month Forward Indexes include those contracts that will be in the DJ-AIGCI in September and October, respectively. Excess and Total Return versions of each of the new indexes are available.
“We want to be responsive to commodity index investors’ needs now that commodities have gained acceptance as a mainstream asset class,” said Michael Petronella, president, Dow Jones Indexes/Ventures. “As forward commodity futures markets have become more liquid, we feel it is important to develop new indexes for investors seeking to take advantage of the different return characteristics of longer-dated commodity futures.”
Dow Jones, AIG launch commodity forward indices
New indices allow investors to measure exposure to longer-dated commodity futures contracts
- By: James Langton
- July 18, 2006 July 18, 2006
- 10:55