MCGRAW HILL FINANCIAL INC 
By NEW YORK, Feb. 24, 2014 /PRNewswire/ -- S&P Dow Jones Indices today announced that it has made several changes to the S&P U.S. Indices methodology effective after the close of trading on March 21 to coincide with the March rebalance. After consulting with clients concerned with certain reporting requirements, expenses, and investment restrictions relating to business development companies (BDCs), S&P Dow Jones has decided to remove all identified BDCs from its U.S. Indices. BDCs will remain eligible for certain other types of indices. In order to increase the number of eligible constituents without sacrificing the profitability criteria, S&P Dow Jones has decided to update the financial viability criteria as described below. A summary of these and other methodology changes can be found in the following table:
Change Previous Methodology New Methodology
------ -------------------- ---------------
Eligible Business development companies were Business development companies
Securities. eligible for inclusion in U.S. (BDCs) will no longer be eligible
Business Indices for inclusion in U.S. Indices
development
companies (BDCs)
will no longer be
eligible for
inclusion in U.S.
Indices
------------------ ------------------------------------ ----------------------------------
Financial Usually measured as four consecutive The sum of the most recent four
Viability. quarters of positive as- reported consecutive quarters' as-reported
earnings. As-reported earnings are earnings should be positive as
Generally Accepted Accounting should the most recent quarter. As-
Principles (GAAP) net income reported earnings are Generally
excluding discontinued operations Accepted Accounting Principles
and extraordinary items. For REITs, (GAAP) net income excluding
financial viability is based on as- discontinued operations and
reported earnings and/or Funds From extraordinary items. For equity
Operations (FFO), if reported. FFO REITs, financial viability is based
is a measure commonly used in REIT on as-reported earnings and/or
analysis. Funds From Operations (FFO), if
reported. FFO is a measure commonly
used in equity REIT analysis.
Updated measurement
of financial previous four
viability replaces quarters of
requirement to earnings should be
have four positive as should
consecutive the most recent
quarters of quarter
positive earnings
with the
requirement that
the sum of the
-------------------
Removal of To reduce turnover in the S&P All stocks in the S&P TMI that are
following Completion Index (CI), all large cap not in the S&P 500 will be included
footnote: redomiciled stocks and mortgage in the S&P CI effective with the
REITs that were added to the S&P quarterly rebalance on March 21.
Total Stock Market Index (TMI) were
excluded from the CI.
[1] In
conjunction with capitalization the March 2013
the updated greater than US$ rebalance with a
domicile 4.0 billion will market
eligibility be excluded from capitalization
criteria effective the S&P Completion greater than US$
June 2010, Index. Mortgage 4.0 billion will
redomiciled stocks REITs (GICS code be excluded from
added to the S&P 40402030) added to the S&P Completion
Total Market Index the S&P Total Index
with a market
-------------------
The S&P U.S. Indices methodology document will be updated on www.spindices.com to reflect these changes.
About S&P Dow Jones Indices
S&P Dow Jones Indices LLC, a part of McGraw Hill Financial, is the world's largest, global resource for index-based concepts, data and research. Home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average(TM), S&P Dow Jones Indices LLC has over 115 years of experience constructing innovative and transparent solutions that fulfill the needs of investors. More assets are invested in products based upon our indices than any other provider in the world. With over 1,000,000 indices covering a wide range of asset classes across the globe, S&P Dow Jones Indices LLC defines the way investors measure and trade the markets. To learn more about our company, please visit www.spdji.com.
Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC, a part of McGraw Hill Financial. Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC ("Dow Jones"). These trademarks have been licensed to S&P Dow Jones Indices LLC. It is not possible to invest directly in an index. S&P Dow Jones Indices LLC, Dow Jones, S&P and their respective affiliates (collectively "S&P Dow Jones Indices") do not sponsor, endorse, sell, or promote any investment fund or other investment vehicle that is offered by third parties and that seeks to provide an investment return based on the performance of any index. This document does not constitute an offer of services in jurisdictions where S&P Dow Jones Indices does not have the necessary licenses. S&P Dow Jones Indices receives compensation in connection with licensing its indices to third parties.
For more information:
David Blitzer
Managing Director and Chairman of the Index Committee
S&P Dow Jones Indices
(+) 212 438 3907
david.blitzer@spdji.com
David R. Guarino
Communications
S&P Dow Jones Indices
(+1) 212 438 1471
dave.guarino@spdji.com
SOURCE S&P Dow Jones Indices
