Ilya Merenzon, the general director of Press Release Group (U.S.), said the number could grow from 12 to 40-70 in two years' time in the wake of the increasing number of Russian companies conducting initial public offerings.
Launched by RIA Novosti and Press Release Group, the Russian Industrial Leaders Index (RUXX) is calculated and published by Dow Jones & Company.
As of January 1, 2006, it comprised 12 companies: Tatneft, MTS, Rostelecom, VimpelCom, Wimm-Bill-Dann, Mechel, Rambler Media, Gazprom, LUKoil, Novatek, AFK Sistema and Golden Telecom.
While commenting on how the index was established, Yekaterina Touton, deputy head of marketing at RIA, said work on the project had started in June 2005. She said analysis showed that few news items connected with Russian business could be found in the foreign press, adding that she hoped "the international press will write more about Russian business" with the new clear macroeconomic indicator.
Andrei Movchan, the president of Renaissance Capital Asset Management and a member of the RUXX index expert council, said the index could help foreigners, especially individuals, become interested in the Russian equity market.
Movchan said the use of the index for commercial operations could bring in considerable cash flows.
According to a joint news release by RIA Novosti and Press Release Group, "Russian Industrial Leaders Index (RUXX) is a composite index of Russian companies trading on global exchanges. It is calculated in U.S. dollars starting January 1st, 2006 and is available from all major data vendors as of February 1st, 2006. The index growth for the first month was 15.946%, from 500 to 579.73 points. The DJIA [Dow Jones Industrial Average] growth was only 1.371% for the same period.
"RUXX is a capital-weighted Index. The higher is the free-float market capitalization of the company, the higher is its respective weight in the Index. However, a 20% weight cap factor is applied to the Index constituents. Usually, changes in the market capitalization and weights are implemented during quarterly review of the Index.
"The Index is computed using the last sale price for the trading day (5.30PM New York time). Its constituents include Russian companies whose depositary receipts are listed on global exchanges: (New York Stock Exchange, London Stock Exchange, Nasdaq, AMEX) The Index value is published daily at 5.55PM New York time in the Dow Jones ITC 2.1 data feed and Chicago Board of Trade (CBOT). It is available via data vendor networks such as Reuters, Bloomberg and others," the news release said.
The RUXX expert council comprises leading Russian, American and European economic experts, state figures and investors.
