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Source joins forces with FTSE Russell and Research Affiliates to launch innovative index series

Source, one of the largest providers of Exchange Traded Products (ETPs) in Europe, has worked with FTSE Russell and Research Affiliates to create the FTSE RAFITM Equity Income Index Series, a new family of indices targeting high dividend?paying stocks which have also been screened to favour sustainable income.

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Research Affiliates is a global leader in “smart beta [1]” and asset allocation. The innovative strategies and asset allocation models developed by the firm over the years have since been incorporated into portfolios by investment professionals throughout the world.

Source’s Executive Chairman, Lee Kranefuss, said: “Many investors have been struggling to generate income in the current environment, with bond yields low and with most high?yielding equity strategies being overly exposed to low quality or low growth stocks. Our investors said they want a strategy that focuses on dividends and is better?structured than what is currently available. This is why we approached Research Affiliates and, together with FTSE, have developed these new investment strategies.”

Jason Hsu, Co?founder and Vice Chairman of Research Affiliates, explained: “Accessing high income remains an unmet need for a good number of investors. We believe these new indices will address this gap in the market, and they will aim to deliver high dividends from quality companies that can sustain and potentially grow their dividends. We were delighted to work with Source on these new indices.”

Caroline O’Shaughnessy, Managing Director, Sales and Marketing, FTSE Russell, commented:   “As our partnership with Research Affiliates reaches its tenth year, we are proud that our close collaboration continues to yield innovative benchmarks that respond to investor needs. Source’s licensing of the FTSE RAFI Equity Income Index Series reflects this, as alternative benchmarks provide a critical, low cost investment solution to a wide range of market participants.”

Source is the first ETF provider to license the new FTSE RAFI Equity Income Indices and later this year will be launching funds that provide exposure to them.

Research Affiliates and FTSE have been working together since 2005 and strategies linked to indices developed by the two firms have approximately US$ 75 billion of assets under management [2].

Source UK Services Limited is authorised and regulated by the Financial Conduct Authority in the UK.

Next Finance June 2015

Article also available in : English EN | français FR


[1] Broadly defined as those that determine weightings by using a set of rules other than just market capitalisation.

[2] Data by Research Affiliates and FTSE, as at 31 March 2015.



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