Kansas City based financial exchanges operator Bats Global Markets Inc (BATS:BATS) has announced that its European arm, Bats Europe, is launching a UK-focused benchmark index series.
Bats will launch 18 different indices covering large to small cap securities and 12 industry sectors. The indices were developed in consultation with investors and index users, to offer a robust and trustworthy alternative to incumbent providers.
Key features include:
- Bats Indices will be published in real-time, rather than most current offerings, which are provided with a 15-minute delay;
- All Bats Indices start with a base value of 10,000 (as at 31/12/2010), a unique detail that will ensure the performance of markets and sectors is easy to compare;
- Bats Indices have simplified index licensing arrangements, with a long term commitment to materially reducing costs to all investors;
- Bats Indices are highly correlated with comparable benchmarks that investors use every day and so are designed to accurately reflect market moves.
A number of leading U.K. headquartered wealth management and stockbroker firms contributed to the development of the indices and have supported the project from its inception. They include Alliance Trust Savings, AJ Bell, Charles Stanley Direct, Hargreaves Lansdown, Rathbones, Selftrade, and TD Direct Investing. Taken together, the named firms account for more than £160 billion of funds under management.
Mark Hemsley, CEO of Bats Europe, said:
As anyone watching financial markets will know, a lot can happen in fifteen minutes and by giving investors an accurate, immediate view of precisely where the market is moving, we can help them make better informed trading and investment decisions. Throughout our history, we’ve sought to make markets better, and more cost-efficient, for investors and traders. This is a first and very important step in improving index provision in Europe.
Sara Wilson, Head of Platform Proposition at Alliance Trust Savings, commented:
The launch of the new indices is extremely positive news for the industry, giving investors the chance to access real-time stock market information from a respected source. Having been closely involved with the project since inception, we look forward to making this additional data available to our customers.
Paul Chavasse, Head of Investment, Rathbones said:
Rathbones is delighted to support the launch of the new Bats UK index series. Bats is providing a comprehensive, robust and low-cost set of real-time indices to end investors. This will offer more depth to the market for data provision, giving clients the information they need to help build and monitor their portfolios better.
Guy Simpkin, Head of Business Development at Bats Europe, explained,
We have worked closely with firms to develop Bats Indices rules, licences and pricing to ensure we deliver long term benefits to customers of every sort across an increasing number of markets.
The indices provide accurate and reliable index data, transparently calculated, and valued using Bats’ high-quality market data with the exception of the Bats UK Alternative 100 which uses ISDX data. The indices are free of charge to private and professional investors, media firms and for benchmarking purposes.
Bats Europe will apply the same regulatory rigour to its index business that it applies across the 15 markets it operates in as a Recognised Investment Exchange. The exchange will take account of, and follow, the relevant International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks for its indices.
As with all index providers Bats Europe will apply to its regulator, the Financial Conduct Authority (FCA), for approval as a Benchmark Administrator under the incoming Benchmark Regulation. Bats Europe is wholly owned by Bats Global Markets (Bats: BATS), a leading global financial markets operator. Around the world, Bats Global Markets has a proven history of delivering world-class technology, products and services that bring competition to monopoly style market structures, to the benefit of all investors.