S-Network employs rigorous research protocols in the development of its indexes, so that all S-Network indexes embody the following characteristics:

• Inclusive.  As a pre-condition to index development, S-Network develops a comprehensive universe of index candidates. Various reference sources and proprietary databases are used to define industries, sub-industries and hybrid industry groupings. Most S-Network indexes are global in scope.
  
  
• Fundamentally Eligible.  The financial reports of universe companies are reviewed to assure compliance with fundamental eligibility criteria. Specifically, most S-Network indexes involve the application of strict revenue hurdles to define participation in a given industry or theme.
  
  
• Statistically Relevant. Market data from multiple sources are used to screen companies for listing and disclosure standards, minimum market capitalization, minimum trading volume and other criteria.
  
  
• Fully Investable. Market restrictions and operational impediments to investment are reviewed to assure that all index constituents are investable by US and EU persons. “Provisional” universes of eligible stocks that do not meet investability standards are maintained to facilitate rapid index inclusion of restricted companies, in the event of changes in the restricted company’s home market structure.
  
  

The foregoing ion processes are codified in comprehensive rule sets (rulebook) that are fully disclosed to the public, making S-Network indexes fully transparent and user-friendly.  The entire ion process is non-discretionary, objective and dependable.

Most S-Network indexes employ modified capitalization-weighting methodologies, adjusted for free float and further adjusted to meet various regulatory requirements with respect to diversification and concentration (e.g. RIC and UCITS compliant).

S-Network indexes are back cast for periods of three to seven years, depending on the index.  S-Net back casting involves a clearly defined process of “re-living” the index on a daily basis, so that all changes to the index driven by rebalancings and corporate actions are reflected in the historic values.

Index Production

S-Network employs stringent quality controls on the calculation and data dissemination of its indexes.

Third party calculation agents, including Dow Jones Indexes and S&P Custom Indexes, provide calculation services for S-Network indexes.  They also conduct the quarterly rebalancings and make adjustments for corporate actions.  Rebalancings and index adjustments are also conducted by S-Network on a fully redundant basis to assure accuracy and quality.

Disclosure of all index changes is handled by S-Network according to specific pre-defined protocols, including press announcements, websites and notifications to data vendors and licensees.

Real-time values for S-Network indexes are distributed via the Consolidated Tape Association (Tape B) in both USD and Euro, as well as other currencies, and most data vendors provide extensive historic and analytic data on the indexes.

S-Network provides independent web sites for each of its indexes or index families.  Web sites contain real time values, historic values, historic index snapshots (constituents, weights and other data), rulebooks, index descriptions, current constituents and weights, industry information, press announcements and other relevant data.

S-Network also provides quarterly information reports on its indexes, entitled “Index Insights.”  These reports provide performances and statistical reviews of salient index developments.