In this week's roundup, we look at some of the most recent developments around new index and product launches including new underlying strategies aimed at product providers from BofA, BITA and the NSE; as well as Leonteq’s expanding its listed offering in Germany and the acquisition of a buy-side provider by a private equity firm.

BITA, a fintech specialising in investment customisation infrastructure and indexing solutions, has partnered with AlphaBeta, an Israeli fintech focused on deep quantitative investment research, to launch a series of multifactor indexes that leverage AI and one of the world’s largest factor libraries to select and weight securities.

Our commitment to quantitative investing and technology-driven strategies aligns perfectly with BITA’s vision - Oded Shimoni, AlphaBeta

This strategic partnership marks BITA’s expansion into the growing factor investing space, combining its technology-driven indexing capabilities with Alphabeta’s deep factor and quantitative model expertise.

The new index series will initially be launched with seven indexes designed to enhance investment performance through a unique multifactor strategy. AlphaBeta’s quantitative models employ over 150 scientifically proven factors, utilising AI-driven analytics and machine learning enabling a clearer view of market dynamics while diversifying risk.

These indexes span both European and US markets and are aimed at investors seeking to optimise returns.

‘Our commitment to quantitative investing and technology-driven strategies aligns perfectly with BITA’s vision. Together, we aim to provide investors with smarter tools and strategies based on advanced academic research targeting strong long-term performance,’ said Oded Shimoni (right), managing partner at AlphaBeta.

Founded by Koby Shemer in 2010, AlphaBeta is grounded in a scientific approach to asset management, utilising a combination of factor-based strategies and AI to deliver investment solutions that aim to outperform traditional benchmarks.

‘Their approach to the construction of factor-based strategies is heavily differentiated from many of the plain vanilla approaches available in the market,’ said CEO Victor Hugo Gomez (pictured).

BofA partners with Newton IM, launches quantitative strategy index

Bank of America has launched the Newton Adaptive Risk Overlay Index (Nimaro index), a customised tail-risk hedging solution that seeks to offset losses to an investor’s asset portfolio during severe market corrections.

Offering the strategy through an index allows a range of implementation options, giving investors flexibility to achieve their investment goals - Mitesh Sheth, Newton IM

The index has been designed as a diversifying strategy to cover tail risks and reduce portfolio volatility and will be managed by Newton Investment Management, an asset manager specialising in multi-assets and equities, which is part of BNY Investments.

Bank of America, as index manager, will provide the basic elements of transparent and systematic hedging for the index. Acting as the index advisor, Newton's multi-asset team will manage the strategy, using the company's patented coverage framework and its multi-asset pedigree dating back more than three decades.

The Nimaro index aims to offer a hedging solution that is "the best of both worlds" and leverages the implementation and execution capabilities of Bank of America's Quantitative Investment Strategies (QIS), along with Newton's extensive experience in tail risk hedging and active management.

‘Offering the strategy through an index allows a range of implementation options, giving investors flexibility to achieve their investment goals and objectives,’ said Mitesh Sheth (right), CIO of Multi-Asset at Newton IM. ‘The index is designed to provide an effective risk management and portfolio construction solution for investors.’

Narvir Brar, head of EQD sales in the UK, Bank of America, said: ‘In times of high market volatility, investors continually seek diversification to protect their portfolios. The index offers investors access to innovative developments in tail risk hedging.’

NSE launches India’s first-ever electric vehicle index

The National Stock Exchange of India (NSE) has announced the launch of the Nifty EV & New Age Automotive Index - India's first-ever electric vehicle index.

The launch of this index will facilitate the creation of products, providing asset managers with the opportunity to invest in the electric vehicle and new-age automotive market - Mukesh Agarwal, NSE Indices

The new index is expected to serve as a benchmark for asset managers and act as a reference index for passive funds such as Exchange Traded Funds (ETFs), index funds, and structured products.

The base date for the Nifty EV & New Age Automotive Index is 2 April, 2018, with a base value set at 1000. The index will be reconstituted semi-annually and rebalanced on a quarterly basis.

The Nifty EV & New Age Automotive Index aligns with NSE’s vision to provide innovative indices in line with market trends, according to Mukesh Agarwal (right), CEO of NSE Indices.

‘The launch of this index will facilitate the creation of products, providing asset managers with the opportunity to invest in the electric vehicle and new-age automotive market, thereby offering a new investment vehicle for investors,’ he said.

Currently, NSE operates 17 thematic indices including Nifty Commodities, Nifty India Consumption, Nifty CPSE, Nifty Energy, and Nifty Infrastructure.

Apart from thematic indices, NSE manages Broad Market Indices such as Nifty, Nifty Next 50, and Nifty 100. It also operates 15 sectoral indices, including Nifty Bank, Nifty IT, and Nifty Auto, along with strategy indices and fixed income indices.

Leonteq expands ETP+ offering to Germany

Leonteq Securities has listed its first exchange-traded product (ETP+) on Deutsche Börse.

By expanding our ETP+ offering beyond Switzerland, we are following our strategic ambition to make our innovative products accessible to a larger number of institutional and retail investors - Alessandro Ricci, Leonteq

The Swiss structured products specialist launched its ETP+ range in Switzerland in 2022 and is now expanding its product range and geographical reach by launching its first ETP+ on Xetra and Börse Frankfurt, two distinct trading segments of Deutsche Börse.

The launch is part of Leonteq’s strategy to diversify its offerings across asset classes, product types, and regions to serve a growing client franchise. The newly launched ETP+ is collateralized and tracks the performance of the Leonteq EUR Overnight Return Index, which is directly linked to the European Short-Term Overnight Rate (Estron) - Estron measures the interest rate for unsecured overnight loans in euros.

‘By expanding our ETP+ offering beyond Switzerland, we are following our strategic ambition to make our innovative products accessible to a larger number of institutional and retail investors,’ said Alessandro Ricci (right), head investment solutions of Leonteq. ‘The first product will allow investors to create exposure to eurozone short-term rates in a fully collateralised manner.’

Leonteq collaborates with SIX Group to offer enhanced security for investors through its ETP+ by using a collateralisation mechanism which is securely held at SIX SIS, with independent and intraday verification conducted by SIX SIS - SIX Repo serves as the collateral agent and direct representative of ETP+ investors.

Exposure to the new index can be gained in swap or note

WestBridge private equity backs Causeway

British buyout firm WestBridge has acquired a majority stake in Causeway Securities, a Belfast-headquartered structured products distributor. 

Causeway Securities has a strong track record of success in the structured products market - James Macleay, WestBridge

This collaboration marks a significant milestone for Causeway Securities as it seeks to accelerate its growth and expand its international footprint. By combining WestBridge’s financial resources with Causeway Securities’ industry expertise, the partnership aims at ‘driving growth and innovation in the structured products market’.

WestBridge’s expertise and support will be instrumental in taking our business to the next level. By leveraging their value creation model, we can enhance our operations, expand our product offerings, and pursue strategic growth opportunities,’ said Conor O’Donnell (right), CEO of Causeway Securities.

‘Causeway Securities has a strong track record of success in the structured products market. We are confident in their ability to capitalize on the growing demand for their products and services,’ James MacLeay, investment director at WestBridge. ‘Our investment aligns with our focus on supporting businesses with high growth potential.’

Do you have a confidential story, tip or comment you’d like to share? Contact Us | SRP (structuredretailproducts.com)