S&P brings in three new index series blending equities and Treasuries

By Jennifer Chiou

New York, Feb. 11 - Standard & Poor's announced the launch of a new series of indexes combining the equity and fixed-income asset classes. The indexes include the:

• S&P Balanced Equity and Bond - Conservative index, which has a long position in the S&P 500 Total Return Index (25% weight) and a long position in the S&P/BGCantor 7-10 Year U.S. Treasury Bond index (75% weight);

• S&P Balanced Equity and Bond - Moderate index with a long position in the S&P 500 Total Return Index (50% weight) and a long position in the S&P/BGCantor 7-10 Year U.S. Treasury Bond index (50% weight); and

• S&P Balanced Equity and Bond - Growth index, which holds a long position in the S&P 500 Total Return Index (75% weight) as well as a long position in the S&P/BGCantor 7-10 Year U.S. Treasury Bond index (25% weight).

According to an agency news release, the indexes are intended for investors seeking differing risk-reward profiles.

All indexes in the series are rebalanced quarterly, and Treasury pricing is provided exclusively by BGCantor Market Data, LP.

"The diversification benefit of holding a portfolio of assets with low correlation is well documented," Michael Kondas, associate director of fixed-income indexes at S&P, said in the release.

"The launch of these new indices allows investors to potentially take advantage of the historically slight correlation in the returns of U.S. equities and U.S. Treasuries."

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