Barclays and Time Inc have announced they have entered into an exclusive agreement to launch a new family of indices based on the Fortune 500, the annual list of the largest public and private corporations in the US ranked by revenue. The indices, which will focus on listed stocks, will be designed to be investable and thus suitable to underlie index-linked investment products such as ETFs.
Barclays and Time Inc have teamed up to launch suite of investable Fortune 500 indices.
The Fortune 500 ranks companies by their total revenues for their respective fiscal years. Included in the survey are companies that are incorporated in the US, operate in the US and file financial statements with a government agency. This includes private companies and cooperatives that file a 10-K or a comparable financial statement with a government agency and mutual insurance companies that file with state regulators.
The annual revenue of the Fortune 500 companies represent two-thirds of the US gross domestic product (GDP) with $12 trillion in revenues, $890 billion in profits, $19tn in market value and a combined workforce of 28 million people worldwide.
Alan Murray, chief content officer and president of Time, commented: “The Fortune 500 list has always been a vital way to track the economy and we are pleased that Barclays has recognised the value of the franchise to create a new index. At Time Inc, we are always looking for smart ways to enhance our brands and the Barclays Fortune 500 family of indices could not be a more natural extension for our iconic list that investors closely follow.”
Barclay’s new indices will provide exposure to the US equity market by tracking the public companies included in the Fortune 500. The index family will include an equal weight index and other weighting methodologies that will provide an alternative to market capitalisation weighted indices. Barclays will launch the first index, the Barclays FORTUNE 500 Equal Weight Index, in July 2017.
Dupe Adeyemo, director in EFS solutions at Barclays, commented: “We are thrilled to announce our agreement with Time Inc through which Barclays will launch a unique and exciting set of indices based on the Fortune 500. The companies that comprise the Fortune 500 are some of the strongest, highest revenue generators in the US and we believe that market participants will benefit from exposure to these companies through the investable indices that we are creating.”
Publishers have a long history in the world of financial market indices, with the Dow Jones, FTSE and Nikkei index suites all stemming from print publications. More recently, Fortune rival Barron’s commercialised its Barron’s 400 Index by teaming up with white-label fund provider ALPS to launch the Barron’s 400 ETF (BFOR) on the NYSE Arca.