The objective of the initiative is to enhance the market's current underlying mechanisms, Coast Investment, being a vital financial information and a contributor to Kuwait's development and economic prosperity, have taken the initiative in assessing the underlying operational structure in an attempt to participate in the augmentation of financial innovation within our local and regional markets.
The current proposal serves as the guideline and the justification for renovating the current indices displayed in the Kuwait Stock Exchange (KSE) and crafting internationally recognized and calculated indices.
The calculation and the current sector allocation in the KSE follows predefined rules based on the management's best effort in coping with the local conditions while maintaining some standards in the segmentation. It has, however, been recognized that financial markets around the world have suffered from this fragmented, presumptuous efforts. Up to year 2005, there has been no single and credible benchmark eligible for standardizing criteria for sector allocation within global financial markets.
On January of 2005, FTSE Group and DOW Jones Indexes have partnered together in creating what is called the Industry Classification Benchmarks (ICB), which reflects a relevant and user-friendly industry classification for local and global trading and investment decisions.
Coast Investment has taken the initiative, in conjunction with FTSE, in decomposing the current weighted indices presented by the KSE based on the internationally recognized ICB standards.