Dow Jones launches BRIC index

Dow Jones Indexes has launched a blue-chip index measuring the performance of the 50 largest and most liquid companies in Brazil, Russia, India and China (BRIC).

The introduction of the Dow Jones BRIC 50 Index responds to the identification of these countries by investors as unique in their potential to sustain high growth rates in coming years and shape the global economy.

Brazil, Russia, India and China are among the biggest and most dynamic emerging market countries, with some emerging markets experts predicting BRIC economies together could be larger than the current G6 (six richest countries in the world) in less than 40 years.

The index is designed to underlie investment products such as mutual funds, exchange-traded funds and other investable products.

The number of components in the Dow Jones BRIC 50 Index is fixed at 15 each for Brazil, India and China, and five components for Russia to reflect the size of each market in the index.

Additionally, each component’s weight is capped at 10 per cent of the index’s total free-float market capitalisation to prevent overweighting of any one component stock.

The index is weighted by free-float market capitalisation and will be reviewed annually in September.

The components of the Dow Jones BRIC 50 Index are selected based on size and liquidity from the Dow Jones Total Market Indexes for Brazil, Russia and India and the Dow Jones China Offshore 50 Index.