ITALY – The Borsa Italiana and Standard and Poor’s are joining together to launch an index that will become the main indicator for the Italian equities market.

The S&P/MIB, which will commence on June 2, is designed to provide a balanced representation of the broader Italian market, covering approximately 80% of Italy’s market capitalisation and free float.

Commenting on the new index, Massimo Capuano, president and chief executive officer of the Borsa Italiana, said: “The new S&P/MIB index provides a more complete representation of the Italian equities market.”

“We anticipate important developments in investable products and portfolio management tools such as derivatives and ETFs,” he added.

According to Eudald Canadell, managing director of Standard and Poor’s (Europe), the new index will provide domestic and institutional investors with “a new benchmark that offers broader exposure to the Italian equity market without sacrificing liquidity.”

“The S&P/MIB will be easy to replicate and will become the basis for derivatives products and other listed index-linked products,” says Canadell.

The index will be maintained by the S&P index committee comprised of representatives from both Standard and Poor’s and the Borsa Italiana. Their primary objectives will be to provide an accurate reflection of the Italian equities market, “minimising index turnover and maintaining high liquidity while ensuring easy replication and low costs for investors.”

The index is comprised of 40 leading companies of the Italian Exchange, but the number will be reconsidered on an annual basis.

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