Dow Jones Indexes has joined Pakistan’s JS Group to launch the Dow Jones-JS Pakistan Islamic Index. The index measures the performance of companies in the Pakistani stock market that pass screens for compliance with Islamic principles.
The Dow Jones-JS Pakistan Islamic Index is designed to serve as an underlying index for investment products such as mutual funds, exchange-traded funds (ETFs) and other investable products. Dow Jones claims this is the first time that a dedicated Islamic Index for Pakistan has been launched by a major global index provider.
“Since the late 1990s, Dow Jones Indexes has been committed to bringing Islamic indexes to countries where investors seek Shariah compliant investment opportunities,” said Michael A. Petronella, president, Dow Jones Indexes/Ventures. “The launch of the Dow Jones-JS Pakistan Islamic Index shows the continuity of our commitment to our Dow Jones Islamic Market Indexes and shows our increasing interest in expanding our Islamic index series to Muslim countries with established stock exchanges.
The components of the index are weighted by free-float market capitalisation, subject to a 10% cap on the weight of any individual security. The index will be reviewed quarterly in March, June, September and December. Historical index values are available daily back to June 30, 2004. The base value of the index is set at 10,000 as of that date.
Companies involved in alcohol, tobacco, pork products, financial services, weapons and entertainment are excluded from the index. Firms are also excluded if they fail certain financial tests related to debt levels, interest-bearing securities and accounts receivables.
“The Dow Jones-JS Pakistan Islamic Index will raise the confidence levels of global investors looking for Shari’ah compliant opportunities in the Pakistan Stock Markets,” said A. Rushdi Siddiqui, global director, Islamic Market Index Group.
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