JP Morgan launches new market index to track Ghana, other countries’ issuance of bonds

J.P. Morgan has selected Ghana among 18 other countries to join its first fixed income Next Generation markets index launched December 13, 2011.

The index, known as Next Generation Markets Index (NEXGEMa), is a fixed-income benchmark that provides exposure to non-investment grade rated, smaller, less liquid population of emerging market economies.

According to a press release from the bank, the index also tracks dollar-denominated government bonds issued by frontier markets, adding “NEXGEMa closely follows the methodology of J.P. Morgan’s EMBI Global Diversified, which is the most widely used benchmark for investors in dollar-denominated emerging market government bonds.”

JP Morgan explains that NEXGEMa selected countries from this benchmark that meet “our criteria for Next Generation Markets.”

“…NEXGEMa includes 18 countries representing sub-Saharan Africa, Central American, the Caribbean, Middle East, Europe and Asia: Ghana, Nigeria, Ivory Coast, Senegal, Belarus, Belize, Dominican Republic, Ecuador, Egypt, El Salvador, Gabon, Georgia, Iraq, Jamaica, Jordan, Pakistan, Sri Lanka, and Vietnam” said the investment banking arm of the JPMorgan Chase & Co.

Allocations to Next Generation markets will likely increase as investors seek diversification and higher yields. NEXGEMa serves as a tracker for these markets, it added.

By Ekow Quandzie