Index Investing: From Theory to Practice · Dr MAI Huu Minh, TRAN Phan Bao Ngoc & HUYNH Nguyen Quoc BuuChapter 12 of 37 · Module 3: Index design
CHAPTER 12
Governance and the Methodology Document
Who writes the rules, who can change them, and how to write them down
Opening question
“Trillions of dollars follow these indexes. Who decides what goes into them — and what stops someone from bending the rules?”
In this chapter
- Why benchmark governance became a regulatory issue after the LIBOR scandal
- The IOSCO Principles for Financial Benchmarks and their four pillars
- The EU Benchmarks Regulation in general terms
- Index committees, conflicts of interest and self-indexing
- Consultations, discretion and its limits
- Error correction and cessation policies
- How to write a methodology document — a full template and a sample outline for NXW Vietnam Banks
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This chapter is in the full book
Chapter 1 is free to read online. The full text of chapter 12 — with its tables, figures, worked examples and practice lab — is available in the complete edition of Index Investing: From Theory to Practice (Volume 1, NXW Investment Library).
Read Chapter 1 freeGet the full book — [email protected]Sections of this chapter
12.1 Why governance matters
12.2 The IOSCO Principles for Financial Benchmarks
12.3 The EU Benchmarks Regulation
12.4 Index committees and the governance structure
12.5 Conflicts of interest and self-indexing
12.6 Consultations, discretion and its limits
12.7 Error correction and cessation
12.8 How to write a methodology document