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Nomura and FTSE Russell Publish FTSE Nomura Climate CaRD WGBI Index
February 4, 2021
Nomura Securities Co., Ltd.
Tokyo, February 4, 2021 - Nomura Securities Co., Ltd., a wholly owned subsidiary of Nomura Holdings, Inc., and FTSE Russell today announced the launch of a new index series named FTSE Nomura Climate CaRD (Carry and Roll Down) World Government Bond Index.
The index benchmarks the FTSE Climate Risk-Adjusted WGBI (World Government Bond Index), which measures the performance of global government bonds (currently 22 countries) in the FTSE WGBI Index while reducing exposure to climate change risk. The index matches the duration and market value weight of each country to the benchmark and invests in government bond portfolios that offer the highest carry and roll down.
Portfolios are constructed monthly, thereby maximizing both government bond carry (yield) and roll-down returns (returns that arise from shortening bond maturity and rolling down the positive yield curve).
The index is designed to mitigate against climate risk, and allows for enhanced returns while meeting the objectives of the ESG benchmark.
ESG investing in bonds is primarily focused on the corporate bond market, which accounts for only about 15 percent of the global bond market. By allowing for ESG investment in the government bond market, which makes up more than half of the global bond market, the index offers higher expected returns and a potential new solution for ESG investment.
The index is developed jointly by Nomura and FTSE Russell, and administered by FTSE. The index value, rulebook and other details regarding the index are available on the FTSE website.
Nomura will continue to provide services that meet investors' needs through developing financial products linked with the index.
Nomura is a global financial services group with an integrated network spanning over 30 countries. By connecting markets East & West, Nomura services the needs of individuals, institutions, corporates and governments through its four business divisions: Retail, Asset Management, Wholesale (Global Markets and Investment Banking), and Merchant Banking. Founded in 1925, the firm is built on a tradition of disciplined entrepreneurship, serving clients with creative solutions and considered thought leadership. For further information about Nomura, visit www.nomura.com.