Barclays Capital Launches World FX Strategy Indices
London, 19 October 2011 – Barclays Capital today announced the launch of two World FX investable indices offering investors exposure to carry and trend strategies through a range of 25 currencies globally.
Carry investing and trend following are the most commonly employed FX investment styles. The Barclays Capital World Carry and World FX Trend Indices are designed to optimally capture these styles and extract value from the global currency markets using a robust and transparent approach.
The Barclays Capital World Carry Index seeks to extract carry across both developed and emerging FX markets. In contrast to a generic carry trade, the index is designed to isolate the carry component of currency returns while reducing exposure to sharp moves in spot exchange rates. The index selects currency pairs with an optimal carry-to-risk ratio and imposes a diversification rule to reduce concentration risk of any individual currency.
The Barclays Capital World FX Trend Index seeks to benefit from trends in global FX markets. The index uses an innovative trend measure to identify and select currencies exhibiting the most consistent trending patterns. Trend following strategies, by design, dynamically follow the direction of the market, which offers potential diversification benefits when combined with other strategies, especially in times of market stress.
Bill Hirschberg, Head of FX Structuring at Barclays Capital said: “The World Carry and World FX Trend Indices offer investors access to the two most popular FX investment strategies. Not only do the two Barclays Capital World FX Indices show consistent performance and diversification, but their combination delivers enhanced risk-adjusted returns.”
Arne Staal, European Head of Index Products & Systematic Strategies Research at Barclays Capital added: “The Barclays Capital World Carry and World FX Trend indices offer exposure to carry and trend risk premia in FX markets while aiming to reduce drawdowns via risk control and diversification. Employing innovative strategies on liquid instruments in the FX markets, these indices are rules-based, transparent and can be used as stand-alone sources of excess return or as building blocks in a style-based investment approach.”
About Barclays Capital Index, Portfolio and Risk Solutions
The Barclays Capital Indices platform offers market-leading benchmarks and other index products to meet the diverse needs of global investors including investment and market analysis of both alpha and beta sources, portfolio benchmarking and performance measurement, asset allocation, and the creation of index tracking funds and index-based structured products.
Barclays is not an advisor and will not provide any advice relating to products. Before making an investment decision, investors should ensure they have sufficient information to ascertain the legal, financial, tax and regulatory consequences of an investment to enable them to make an informed investment decision. Past performance is no indication of future performance. Barclays Capital is the investment banking division of Barclays Bank PLC. Barclays Bank PLC is authorised and regulated by the UK Financial Services Authority and a member of the London Stock Exchange. Barclays Bank PLC is registered in England No. 1026167. Registered Office: 1 Churchill Place, London E14 5HP.
About Barclays Capital
Barclays Capital is the investment banking division of Barclays Bank PLC. With a distinctive business model, Barclays Capital provides large corporate, government and institutional clients with a full spectrum of solutions to their strategic advisory, financing and risk management needs. Barclays Capital has offices around the world, employs 25,000 people and has the global reach, advisory services and distribution power to meet the needs of issuers and investors worldwide.
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