Methodology Change | Solactive Battery Energy Storage Performance-Index | Effective Date 04/10/2022
Today, on the 28/09/2022, Solactive announces the following changes to the methodology of the following index (the ‘Affected Index):
| NAME | RIC | ISIN |
| Solactive Battery Energy Storage Performance-Index | .SOLBES | DE000SLA4Z26 |
Rationale for Methodology Change
Solactive has determined that to elicit further clarity from the selection process and better serve the index objective, a methodology change would be required. The current selection criteria do not capture effectively the intended exposure of the index strategy anymore. Considering the dynamics observed within the market and given Solactive current best practices, the methodology will undergo the changes as depicted in the next sections.
Changes to the Index Guideline
The following Methodology changes will be implemented in the following points of the Index Guideline (ordered in accordance with the numbering of the affected sections):
- The wording in Section 2.1 of the index guideline is replaced by the following wording:
From (old version):
“[…]
The initial composition of the Index as well as any ongoing adjustment is based on the following rules:
On a Selection Day, Index Components are chosen from the Index Universe as defined in chapter 4 subject to the
following criteria:
- The index shall contain a minimum of 10 and a maximum of 20 Index Components.
- If possible, two companies from each Sub-industry of the FactSet RBICS classification system should be included in the Index. In case more than 2 companies fulfill the criteria described in section 4, the two companies with the highest Market Capitalization on the Selection Day are included.
a. For example, in case there are more than 20 Stocks from more than 10 Sub-industries, only the companies with the highest Market Capitalization that fulfill the restrictions above (i.e. a maximum of 2 companies per sub-industry) are included.
- If there are less than 20 Stocks after step 2 up to 4 companies from each sub-industry in the Index Universe are allowed to be included in the Index until the Index has 20 Index Components. The order in which companies are included in the Index is defined by their descending ranking based on the Market Capitalization.
- If there are less than 10 Shares after step 2 and step 3 the 10 companies with the highest Market Capitalization on the Selection Day are selected from the Universe independent of their RBICS Sub-industry.
[…]“
To (new version):
“[…]
Based on the “Index Universe”, the initial composition of the Index as well as any selection for an ordinary rebalance is determined on the Selection Day in accordance with the following rules:
- Classified under any of the following Subindustries by the FactSet Revere Business Classification System (RBICS):
| Category | RBICS Subindustry (Code) | Maximum |
| Electric Vehicle Economy | Electric Vehicle Batteries Manufacturing, Battery Charging Equipment Manufacturing, Traditional Vehicle Batteries Manufacturing, Alternative Energy Transit Vehicles Makers (only the greatest company by Share Class Market Capitalization from this subindustry), Alternative Energy Car Manufacturers (only the greatest company by Share Class Market Capitalization from this subindustry) | 6 |
| Industrial Battery Maker | Mixed Heavy-Duty and High-End Batteries Makers, Heavy-Duty Industrial Batteries Manufacturing, Military Batteries Manufacturing | 4 |
| Consumer Battery Maker | Consumer Batteries Manufacturing, Electronic Materials Manufacturing, Diversified Technology Hardware (only companies that contain it its business description provided by FactSet the keyword “rechargeable batteries) | 5 |
| Mining and Chemical Processes | Mixed Specialty and Commodity Chemical Makers (with the keyword “batteries” in its business description), Lithium Compounds Manufacturing, Other Additive Manufacturing (with the keyword “lithium” in its business description), Diversified Specialty/Performance Chemicals Makers (with the keyword “lithium” in its business description) | 5 |
- All eligible securities within each category are ranked based on their Share Class Market Capitalization in descending order. Only the top companies as described in the table above for each category are selected to have 20 Index Components. In case less than the number of securities for each category as described in the table above are eligible, all securities in each category are selected and the Index consists of less than 20 Index Components.
The selection of the Index Components is fully rule-based, and the Index Administrator cannot make any discretionary decision.
[…]“
- The wording in Section 4 (Section 6 in the new guideline format from the effective date) of the index guideline is replaced by the following wording:
From (old version):
“[…]
“Index Universe” in respect of a Selection Day are companies that fulfill the following criteria:
1. Listed on a Regulated Stock Exchange in the following countries: Australia, Belgium, Denmark, Germany,
Finland, France, Hong Kong, Ireland, Italy, Japan, Mexico, New Zealand, Netherlands, Norway, Austria,
Portugal, Sweden, Switzerland, Singapore, Spain, South Korea, United States of America, United Kingdom.
2. Average Daily Value Traded of at least USD 2 million over the past three months up to and including the
Selection Day.
3. Market capitalization of at least 750 million USD
4. Shares of companies that operate in the segments of Lithium production, manufacturing of chemicals for battery production, and battery production which do generate or are expected to generate significant revenues in these areas. Moreover, all companies that pass the above criteria and are classified in any of the two following Sub-industries of the FactSet RBICS classification system are eligible for inclusion: Heavy Duty and High-End Batteries Manufacturing or Consumer Batteries Manufacturing
[…]“
To (new version):
[…]”
“Index Universe” in respect of a Selection Day are companies that fulfill the following criteria:
1. Listed on a Regulated Stock Exchange in the following countries: Australia, Belgium, Denmark, Germany,
Finland, France, Hong Kong, Ireland, Italy, Japan, Mexico, New Zealand, Netherlands, Norway, Austria,
Portugal, Sweden, Switzerland, Singapore, Spain, South Korea, United States of America, United Kingdom.
2. Average Daily Value Traded of at least USD 2 million over the past three months up to and including the
Selection Day.
3. Market capitalization of at least 750 million USD
[…]”
From (old version):
“[…]
“Adjustment Day” is the third Wednesday of April and October
[…]”
To (new version):
“[…]
“Rebalance Day” is the third Wednesday of April and October
[…]”
From (old version):
“[…]
A “Business Day” is a day on which Boerse Stuttgart AG is open for trading
[…]”
To (new version):
“[…]
A “Calculation Day” is every weekday from Monday to Friday
[…]”
Defined terms used in this announcement, but not defined herein, have the meaning assigned to them in the respective index guideline of the Affected Indices. The amended version of the index guideline will be available on the effective date.