BMFBOVESPA and Dow Jones Partner up to Offer New Indices in Brazil

BMFBOVESPA, the largest equity and futures exchange in Latin America and S&P Dow Jones Indices (S&P DJI), a provider of financial market indices, have jointly announced the signing of Memorandum of Understanding (MOU) to start up a series of co-branded equity indices in Brazil.

All new indices will be calculated, quoted and marketed globally by S&P DJI. S&P Dow Jones Indices offers investment professionals around the world an array of products from efficiently representative indices to broad comprehensive benchmarks.

According to the MOU, all new equity indices as part of this agreement will be co-branded “S&P/BM&F BOVESPA”. Factor-based indices such as Volatility Volatility In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad In finance, volatility refers to the amount of change in the rate of a financial instrument, such as commodities, currencies, or stocks, over a given time period. Essentially, volatility describes the nature of an instrument’s fluctuation; a highly volatile security equates to large fluctuations in price, and a low volatile security equates to timid fluctuations in price. Volatility is an important statistical indicator used by financial traders to assist them in developing trading systems. Trad Read this Term, sector indices and multi-asset baskets based on existing S&P DJI quotes are being actively considered with future investment products potentially being based on the newly created indices.

Disclosing the deal to the public earlier today, BMFBOVESPA said, “The agreement also paves the way for a broader relationship between the two parties, including the expansion into other asset classes."

Commenting on the deal, Alex Matturri, CEO of S&P Dow Jones Indices said, “BM&FBOVESPA and S&P Dow Jones Indices have historically shared very similar goals in bringing greater transparency and access to the stock markets of Brazil. Today’s announcement officially aligns these common interests to the betterment of investors.”

Brazilian Stock Market

BM&FBovespa is Brazil's leading Stock Exchange Stock Exchange A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin A stock exchange, also known as a securities exchange or bourse represents is a facility where stockbrokers and traders can buy and sell securities.This includes shares of stock, bonds, exchange-traded funds (ETFs), or other financial instruments. By extension, stock exchanges can also provide facilities for the issue and redemption of such securities and instruments and capital events including the payment of income and dividendsStock exchanges have developed into a permanent fixture in the fin Read this Term and serves as a good bellwether for the broader Brazilian market. In a results announcement yesterday, the company reported a net income of $92 million in Q3 compared with an average estimate of $112 million in a survey of market analysts.

Having missed Q3 profit estimates BM&FBovespa said profit has been affected by a non-recurring loss of $24 million due to a one-off renegotiation of tax liabilities with Brazilian tax authorities.

According to Edemir Pinto, CEO of BM&FBOVESPA since 1999: “The partnership between BM&FBOVESPA and S&P DJI is a very important step towards increasing our opportunities in the development of the Brazilian capital market.

This move represents a raise on the offering of indices by a relevant and highly-skilled international player. The association of our brand to S&P DJI’s on new co-branded indices will reinforce BM&FBOVESPA’s position overseas through S&P DJI’s global index distribution.”