Asia Index, a joint venture between S&P Dow Jones Indices and BSE, launched a new index to measure the performance of Collateralised Borrowing and Lending Obligation (CBLO) rate — one of the most liquid rates in the country — over a period of time.
The new index — S&P BSE Liquid Rate Index — can be used to create exchange traded funds (ETFs) for both retail and institutional investors.
The index is designed to measure the returns from a daily rolling deposit at the CBLO rate.
As the Indian fixed income market is maturing, investors are seeking a tool to measure the performance of CBLO rates over a period of time.
The new index would be calculated using the CBLO rate for transactions maturing on the following business day and with settlement T+0.
Rates used would be provided by Clearing Corporation of India Ltd (CCIL).
The S&P BSE CBLO Index is calculated only on those days when both BSE and CCIL are open.